Grant Thornton New Zealand (NZ) is the local network of Grant Thornton International — a major professional services network of independent accounting and consulting member firms.
In mid-January of this year, Cryptopia revealed that it had been the target of a security breach resulting in significant losses, with the attack continuing for two weeks after its initial detection until the exchange managed to regain control of its wallets.
According to Grant Thornton NZ, Cryptopia has decided to go into liquidation as it has been unable to return the business to profitability, notwithstanding management’s reported efforts to reduce costs. The decision has been deemed to be in “the best interests of customers, staff and other stakeholders,” the announcement states.
The liquidators will reportedly conduct an investigation and focus on securing assets for the benefit of stakeholders, during which all trading services on the platform will be suspended. In a statement, David Ruscoe outlined:
Ruscoe added that given the complexities of the case, Grant Thornton NZ expects the investigation “to take months rather than weeks.” The liquidators are said to be working alongside independent experts and the relevant authorities to determine the company’s obligations.“We realise Cryptopia’s customers will want to have this matter resolved as soon as possible. We will conduct a thorough investigation, working with several different stakeholders including management and shareholders, to find the solution that is in the best interests of customers and stakeholders.”
Grant Thornton NZ will publish an initial report to the New Zealand Companies Office website next week.
As reported in January, Cryptopia had initially told users that it was undergoing unscheduled maintenance, issuing several updates before officially reporting the breach.
An analysis from blockchain infrastructure firm Elementus estimated in February that as much as $16 million worth of ethereum (ETH) and ERC-20 tokens were siphoned from the platform during the attack — $3.2 million of which were later traced in liquidations on exchanges such as Etherdelta, Binance and Bitbox.
Earlier this month, major crypto exchange Binance was the target of a major hack that resulted in the theft of around 7,070 bitcoin (BTC) from the exchange’s hot wallets — worth over $40 million at the time.