Thai Regulator Probes Crypto Firm Zipmex Amid Buyout

Key takeaways:

  • According to reports, Zipmex is being investigated by the Thai SEC for possible rule violations.
  • The agency is also investigating any possible investor misinformation concerning the exchange’s business operations.

The struggling cryptocurrency exchange Zipmex, which is currently being acquired, may have broken local laws while selling particular digital asset products, according to Thailand’s securities authority.

On December 28, the Securities and Exchange Commission (SEC) of the country sent a letter to Zipmex Thailand’s CEO, Akalarp Yimwilai, expressing concern that Zipmex Thailand might be acting as an unlicensed “digital-asset fund manager.” The comment explicitly relates to ZipUp and ZipUp+, the company’s cryptocurrency return-earning schemes.

The Securities and Exchange Commission (SEC) of Thailand disclosed in September  last year that the exchange and Akalarp Yimwilai, the company’s founder and CEO of its Thai branch, had been reported to the police.

Zipmex has until January 12 to address whether it has been operating in Thailand as a “digital asset fund manager without authorisation,” according to the Thai SEC. If this is the case, the company would have had to get a license in order to operate there.

The regulator’s inquiries relate to the ZipUP and ZipUP+ programmes, which allowed clients to earn returns on their tokens and were offered by the Bangkok-based exchange from October 2020. Babel Finance was contracted by Zipmex to run and oversee investments. 

Zipmex said in July that it might have had exposure to struggling Babel Finance. Sources claim that the $100 million in funds that Zipmex’s Singapore branch lent to troubled Babel Finance through ZipUp will be lost.

The Thai SEC’s action coincides with increased global regulatory scrutiny of the cryptocurrency market. Investigations are also being conducted into Stack’s acquisition of Zipmex because there is still little information available regarding the specifics and conditions of the transaction.

It is noteworthy that Zipmex Asia, the company’s parent with headquarters in Singapore, was reportedly being bought by V Ventures, a division of Thoresen Thai Agencies, for US$100 million in December.

The Asian cryptocurrency exchange has been seeking reorganisation since it collapsed due to the protracted bear market in virtual coins.

Aadrika Sharma
Aadrika Sharma

I enjoy writing and try to learn new things every passing day!

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