The largest cryptocurrency exchange in Canada has been unable to access $28 million in Bitcoin, Ethereum and other cryptocurrencies since January 2018. Some cryptocurrency holders have been unable to access funds as they wait for the Ontario Superior Court of Justice to reach a verdict.

Canadian Government Freezes Cryptocurrency Accounts

QuadrigaCX, otherwise known as Quadriga, is Canada’s largest cryptocurrency exchange, based in Vancouver. You can invest USD or CAD in Bitcoin, Bitcoin Cash, Bitcoin Gold, Ethereum and Litecoin. According to their website, Quadriga is the fastest expanding BTC/USD and BTC/CAD exchange in Canada, and one of the fastest worldwide.

Per an article in The Globe and Mail, Quadriga saw a surge of $67.1 million in investment between December 2017 and early 2018. To date, $28 million from that investment round remains.

In January 2018, CIBC, one of Canada’s largest banks, filed a court order to freeze five accounts holding $28 million. Costodian Inc., Quadriga’s payment processor, and its owner Jose Reyes, hold those accounts. CIBC claims that they cannot identify who owns the funds. It could be Costodian, Quadriga or the 388 customers from whom the funds originated.

Since these funds are used to facilitate exchanges, this court order has impeded Quadriga’s ability to function. For example, one Reddit user claims that Quadriga has frozen $719,000 USD, or 108 BTC, without explanation. Other Quadriga users filed withdrawal requests months ago. The exchange has yet to liquidate their funds.

Canadian Court Has Yet to Issue a Verdict

Quadriga has stated that they own the majority of the funds. In court, the largest cryptocurrency exchange in Canada explained that “[CIBC] has been holding the respondents’ funds hostage since January 8, 2018, while it hopelessly attempts to find an ex-post facto justification for wrongfully freezing and continuing to freeze the accounts in the first place.”

Quadriga has cited the “Canadian banking cartel” in correspondence with customers. Several major Canadian banks, including BMO Financial Group and TD Bank, have stopped their customers from investing in Bitcoin.

This case went to court in summer 2018. However, the judge has yet to reach a verdict. Until further notice, neither Quadriga nor its customers can access $28 million.