Cryptopia’s receivers Grant Thornton have issued an update for its long-suffering customers, but this update brings a crumb of comfort to those who feared the coins held on the platform were lost forever. In an update to the ongoing liquidation process, the exchange announced that it had taken a major step forward in making customers whole by managing to retrieve important data from a third-party server that it has had to fight to get back. Calling this a “very pleasing step”, Grant Thornton can now begin the arduous process of working out how to refund customers.
— Cryptopia Exchange (@Cryptopia_NZ) August 21, 2019
Manual Reconciliation Process Necessary
Cryptopia was hacked in January when some $16 million worth of assets were stolen, but by late April things were looking good for a relaunch. In mid-May however the operators shocked customers by abruptly going into liquidation, revealing two weeks later that there would be severe delays in customers getting any recompense because the servers on which the crucial information sat weren’t owned by Cryptopia but were instead owned and operated by an American hosting service. This situation has finally been resolved, but this is just a step in a much larger process. As Grant Thornton acknowledge in the update, users did not have individual wallets on the site, making it “impossible to determine individual ownership using just the keys in the wallets”, meaning that a much more long-winded process must take place:
To determine each customer’s holdings we must undertake a manual process to determine what is held in the pooled wallets and then reconcile the information with that held in the customer database. We are hopeful this process will show us the holdings of individual account holders. This process is well underway but will still take some time to complete. We are working to reconcile the accounts of over 900,000 customers, many holding multiple crypto-assets, millions of transactions and over 400 different crypto-assets). These must be reconciled one-by-one.
New Zealand Courts Will be Involved in Payouts
Grant Thornton also state in the update that they are still working with police and other international authorities to find the source of the hack, which is still unclear eight months later, and that once they do finally establish who is owed what and how to pay them back, the final reconciliation will have to be conducted through the New Zealand Courts, dealing a blow to those who wanted the repayment to be dealt with anonymously.