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Consultancy firm to investigate blockchain transactions in QuadrigaCX case

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The Canadian law firm representing creditors of the defunct crypto exchange QuadrigaCX has hired consultancy firm Kroll to advance its investigation into $190 million lost in user assets in early 2019.

As reported, controversy has engulfed QuadrigaCX following the death of its founder, Gerald Cotten, in December 2018, who had purportedly been the sole person with access to the exchange’s cold wallet holdings. 

In a notice to creditors on Sept. 8, Miller Thomson said that Kroll will be working in collaboration with its strategic partner, Coinfirm, which specializes in blockchain forensics and anti-money laundering (AML) compliance. 

Coinfirm is the developer of a blockchain analytics engine that is designed for crypto asset tracing, fraud investigations, data analytics and asset recovery.

According to Miller Thomson’s update, Kroll and Confirm will be tasked with analyzing a subset of transaction data. Citing the sensitive nature of these transactions and the ongoing involvement of law enforcement, the notice states that further details of Kroll’s engagement will not be publicly elaborated. 

Kroll’s fees have been capped to $50,000 and the company has contractual indemnity of up to $150,000. Its engagement was jointly decided by Miller Thomson, the inspectors of QuadrigaCX’s bankruptcy estate and an appointed Official Committee of Affected Users.

Miller Thomson’s update also reveals that it has forwarded information about the controversial Panama-based payments processor Crypto Capital, which provided services to QuadrigaCX prior to the exchange’s collapse, to Quadriga’s monitor Ernst & Young.

“There is currently insufficient evidence to establish that Crypto Capital owed any funds to Quadriga as of the date of bankruptcy,” Miller Thomson states. However, should any new information arise regarding the matter, Ernst & Young “will consider recovery avenues available to the Quadriga estate.”

Lastly, the notice suggests that compensation of creditors is likely to remain a protracted process. “The most material impact on the speed of distribution will be the CRA [Canada Revenue Agency]’s audit of Quadriga’s tax liabilities,” Miller Thomson states. 

The CRA has reportedly declined to confirm a timeline for completion of its audit given the disruptions caused by the coronavirus pandemic.



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Enjin joins Crypto Climate Accord, goes carbon negative

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Enjin, a blockchain gaming and nonfungible token platform, has stepped up to decarbonize its footprint by joining the Crypto Climate Accord, a move that adds further credibility to the industry’s growing environmental mandate. 

The Crypto Climate Accord is backed by 20 firms from the blockchain, fin-tech and greentech industries. Inspired by the 195-signatory Paris Climate Agreement, the Accord was established in April to address the “large and growing energy consumption of cryptocurrency and blockchain, and the climate impact of their energy use.”

Enjin claims that its JumpNet blockchain has already achieved carbon-negative status nine years ahead of schedule. In March, the company said it planned to enable carbon-neutral NFTs by 2030.

“The creation of new forms of technology should never come at the cost of destroying our environment,” said Enjin CEO Maxim Blagov. “Carbon neutrality for JumpNet is an important step toward our vision of a sustainable NFT ecosystem for Enjin and our partners.”

In addition to decarbonizing newly created tokens, Enjin’s environmental sustainability plan includes supporting the tokenization of the physical economy and decarbonizing existing digital assets. Other measures include upgrading to carbon-neutral nodes and incentivizing carbon reduction technologies.

Environmental concerns have virtually hijacked Bitcoin’s narrative this year, with the likes of Elon Musk casting shade over carbon-intensive mining. The Tesla CEO briefly embraced Bitcoin earlier this year before deciding that BTC payments are no longer acceptable due to environmental risks. Now, he states that his firm is willing to accept payments of the virtual currency, provided there’s more evidence for sustainable mining.

Related: Elon Musk lays out when Tesla will begin accepting Bitcoin payments

Other environmental sustainability efforts within crypto are also underway. As Cointelegraph reported, Tyler and Cameron Winklevoss’ Gemini exchange has purchased carbon credits to reduce Bitcoin’s carbon footprint. Separately, U.S. miner Stronghold Digital Miner recently announced that it raised $105 million to divert waste coal to cryptocurrency mining.