Province Wins Default Forfeiture of About $1M in Cash, Gold and Luxury Items Tied to QuadrigaCX Co‑founder

Default judgment hands roughly $1 million in cash, gold and valuables to the province

The court entered a default judgment in favour of a Canadian province, awarding the government control of about $1 million in cash along with gold bars, watches and other valuables tied to Michael Patryn, a co‑founder of the collapsed crypto exchange QuadrigaCX. The ruling came after Patryn did not defend the forfeiture action.

How this links back to QuadrigaCX — a quick timeline

QuadrigaCX was once Canada’s largest cryptocurrency exchange. Its sudden collapse left customers unable to access funds and prompted criminal and civil probes. Michael Patryn was identified in public records and court filings as one of the people connected to the exchange’s operations. Over the years, authorities pursued different leads to find recoverable assets linked to the case.

Investigations and seizures related to Quadriga’s collapse began shortly after customer withdrawals froze. Law enforcement and provincial authorities have since taken steps to trace funds and recover assets they say are connected to wrongdoing or to proceeds of suspicious activity. This forfeiture action is one of several legal moves aimed at turning recovered property into money that the state can hold or dispose of.

What a default judgment means and how the court ordered forfeiture

A default judgment happens when a defendant does not respond to a court claim. In plain terms: the province presented its case, Patryn did not file a defence, and the court accepted the province’s version of events. When a defendant fails to respond, the judge can grant the relief the plaintiff seeks — here, ownership of specific assets — without a trial on contested facts.

The province used its civil forfeiture powers — a tool available under provincial laws designed to strip property believed to be tied to crime or unjust enrichment. Courts generally require evidence that links the property to unlawful activity or that the owner cannot show a legitimate origin. Because there was no defence, the court concluded the province had met the standard required to forfeit the items in question.

That said, default judgments are not always final. The absent party can apply to set aside the judgment or appeal, but courts usually require a good reason for the initial lack of response — for example, not being served with papers or a serious procedural mistake. If an application to set aside fails, the forfeiture stands and the province moves toward disposing of the assets.

Inventory: what was seized and who has custody

The court order names roughly $1 million in cash and several valuables stored in a safety deposit box at a major Canadian bank, along with funds in at least one bank account. Authorities list gold bars, luxury watches and jewellery among the items. The province’s enforcement team secured the items under court authority and they are now in provincial custody, held pending valuation and disposition steps.

Seizures followed court applications backed by search or preservation orders served on the bank and other holders. That chain of custody — bank to law‑enforcement to provincial control — is important because it affects how easily the province can sell items and how cleanly it can show the assets were preserved since the order was made. Valuation questions remain: the final sale proceeds will depend on appraisals, market prices for gold and the condition and provenance of luxury goods.

What this ruling means for investors and the crypto industry

The immediate, plain take: enforcement agencies are willing and able to use civil forfeiture to turn recovered crypto‑era property into cash. For investors and crypto firms, that matters in two ways.

First, it strengthens a practical avenue for asset recovery. When authorities find tangible property tied to crypto losses, they can ask courts to convert that property into funds the state controls. That may offer a path, however imperfect, to shrink the pool of unrecovered assets from exchange collapses.

Second, it raises the stakes for custodians, exchanges and anyone holding assets on behalf of others. Regulators and enforcement bodies are signaling they will pursue not just crypto wallets but any tangible wealth linked to alleged wrongdoing. Expect pressure on custodians to tighten controls, on exchanges to improve transparency and on insurers to clarify coverage for custody failures. That can be positive for mainstream investor confidence — stronger controls make platforms safer — but it also increases compliance costs and operational complexity for smaller players.

Finally, the ruling is a reminder that recovered assets often do not automatically go to customers. Civil forfeiture proceeds typically flow to provincial coffers or designated funds; the link between recovered money and payments to victims can be indirect and slow. That reality should temper expectations about how much justice a court order like this will deliver directly to former Quadriga customers.

What comes next — appeals, sales and key documents to watch

Possible next steps include an application to set aside the default judgment, an appeal, or administrative moves by the province to value and sell the seized items. The province will likely seek court approval for sale or public auction and then report proceeds into its accounts or a special fund.

Watch for three filings: any court motion from the defendant to reopen the case; a valuation report or inventory schedule; and a government notice of intended sale or disposition. Those papers will tell whether the judgment is final, how much the assets might yield, and whether any portion could be routed toward restitution or victim compensation programs.

For investors and crypto stakeholders, the takeaways are straightforward: enforcement is active, civil tools can be used to recover non‑crypto assets linked to crypto cases, and recovered property may not translate quickly into payouts for victims. The ruling strengthens the idea that bad actors can be chased into the traditional financial system — but it does not erase the messy reality of getting money back to people who lost it.