I'm a Canadian. I'm no interested in crypto, but I've been watching this trainwreck. Much of the information is summarized here:
https://amycastor.com/2019/02/12/how-the-hell-did-we-get-here-a-timeline-of-quadrigacx-events/The owner, Gerry Cotten, was incompetent at finances, not filing his corporate taxes or having an accounting system. His widow (whom he only recently married, and has changed her name several times) didn't care about the customers at all. (In the month plus period of time it took her to alert the customers that the owner had died, she sold off his assets, and specifically asked the buyers to keep his death a secret. While there's no proof that she committed fraud, this doesn't look good.) During this period the company still accepted some automated deposits.
The co-founder, "Michael Patryn", was a convicted identity thief who was deported from the US back to Canada. Patryn left the company in 2016, the same year it failed to go public due to a lack of paperwork.
The company would literally mail people cash, and have people pick up or drop off cash at its offices, which is not a mark of a reputable company. Of course people had trouble withdrawing money, because the company essentially became a "bank" (fractional reserves, but with no oversight, no CDIC [FDIC equivalent], and so forth). The owner is said to have put his own money into the exchange to keep it afloat.
The cold wallets are empty, so nobody needs the passwords. Most of the money was moved out in April 2018. The company created 14 fake accounts (filled with fake deposits) and moved the money to a number of other exchanges (I believe 14 of them!). Non-Canadian exchanges will probably not listen to court orders unless they're reputable. Some of these other exchanges... were not.
The company had been in financial trouble since mid 2017 (when they got hacked) and it became obvious in early 2018 (when their "bank accounts" were frozen, only they weren't their bank accounts, and they didn't even have an accounting system). Much of the money was frozen in bank drafts that banks refused to honour; the bankruptcy judge had to issue an order protecting the banks before they would honour these drafts.
This company used to be the largest cryptocurrency exchange in Canada, and was probably the first one to launch here (which is probably the only reason for its previous success). There were no regulations on cryptocurrency here, and I believe many of the investors saw the lack of government oversight as a feature, not a bug. They invested in something with no government oversight and got exactly what they wanted... no government oversight.
Some of the original stories suggested the owner faked his death and was running an exit scam, but this seems more like incompetence than anything else. He would have been better off robbing customers back in 2017, when bitcoin was worth a lot more and he was... alive. Due to the lack of regulation, he could run his company so incompetently and get away with it.