Key Takeaways
- During this suspension period, users are encouraged to directly contact the exchange for any withdrawal needs.
- SEC contends that Zipmex Thailand misused a digital asset custodian service
In a strategic move to comply with regulatory demands, Zipmex, a cryptocurrency exchange headquartered in Singapore, has decided to suspend all digital asset trading operations in Thailand. This temporary halt, effective from 1:00 PM on November 25, comes in response to the criteria set by the Securities and Exchange Commission (SEC) in Thailand.
The primary objective is to ensure Zipmex’s business operations align appropriately with the regulatory standards established by the Thai SEC. This regulatory-driven decision prompts the exchange to temporarily suspend trading and depositing activities for all types of assets in Thailand.
The aim is to guarantee that Zipmex’s operations are in accordance with the SEC’s stringent criteria. During this suspension period, customers are encouraged to directly contact the exchange for any withdrawal needs. After January 31, 2024, when website and app-based withdrawals will also be temporarily suspended, customers will need to liaise with Customer Support for further assistance with withdrawals.
While headquartered in Singapore, Zipmex serves markets in Thailand, Australia, and Indonesia. The exchange now finds itself facing potential penalties from the Thai SEC due to alleged misconduct. The regulator contends that Zipmex Thailand misused a digital asset custodian service and directed customers to the Singapore-based exchange Zipmex Pte, creating a conflict of interest.
Despite seeking an extension for a debt moratorium in Singapore, Zipmex remains under heightened regulatory scrutiny. A $100 million buyout deal fell through earlier this year, triggering a probe by the Thai SEC on January 10 for potential breaches of new local rules.
On January 11, the SEC issued a one-day ultimatum to Zipmex, demanding an admission or denial of operating as a digital asset fund manager without proper authorization. The ongoing regulatory scrutiny began on September 7 when the SEC filed a police report, citing ‘incomplete’ information provided during compliance procedures.
This development follows Zipmex’s financial challenges in July 2022, including the suspension of withdrawals and the freezing of accounts. The industry-wide impact of a prolonged bear market led to significant financial strain, affecting various businesses in the cryptocurrency sector.
