Key takeaways:
- The struggling crypto exchange Zipmex’s recovery strategy is showing signs of weakness.
- The rescue effort failed following the company’s failure to obtain the most recent payment required under a venture capital acquisition worth US$100 million.
As a result of an investor missing a deadline to make a US$1.25 million payment, the troubled cryptocurrency exchange Zipmex is having problems with its US$100 million venture capital acquisition, according to Bloomberg.
After being impacted by the cryptocurrency bear market last year, Zipmex is being purchased by V Ventures for US$100 million as part of its restructuring plan. The exchange had US$48 million in exposure to cryptocurrency lender Babel Finance and US$5 million in exposure to bankrupt lender Celsius.
On July 22 of last year, Zipmex declared bankruptcy in Singapore after being compelled to halt withdrawals due to falling cryptocurrency prices. To halt legal action against the exchange for a while, lawyers submitted moratoria, which are similar to U.S. Chapter 11 petitions.
Akalarp Yimwilai, a co-founder of Zipmex, wrote to the company’s staff today, saying, “Zipmex is suffering from financial difficulties and we will not be able to pay out full salary for this month of March 2023.” The Block acquired this email.
According to the letter, Zipmex offices in Thailand, Singapore, and Indonesia currently have the funds necessary to pay wages. Zipmex stated it is collaborating with its advisors on the next steps because it has not yet gotten a definitive answer regarding “when and whether” the most recent payment will be made.
The cryptocurrency exchange has been struggling for quite some time now. Back in January, Thai Regulator launched a Probe Crypto Firm Zipmex Amid Buyout.
The Securities and Exchange Commission (SEC) of Thailand has criticised Zipmex and is investigating whether the business violated its regulations regarding digital assets.
The regulator’s inquiries concern the ZipUP and ZipUP+ programs, which the Bangkok-based exchange started offering in October 2020 and enabled customers to earn returns on their tokens. Zipmex hired Babel Finance to manage and supervise investments.
