Zipmex, a cryptocurrency exchange focused on Southeast Asia, has filed for bankruptcy protection in Singapore, seeking protection against legal threats from creditors.
The exchange approached the Singapore court for bankruptcy protection on July 22, only a couple of days after it suspended withdrawals from its platforms.
“This helps protect Zipmex against third-party actions, claims, and proceedings while it is active, and enables the team to focus all our efforts on resolving the liquidity situation, without having to worry about defending potential claims or adverse actions while we are doing so,” the crypto exchange stated.
The solicitors of the exchange submitted five applications, seeking moratorium relief, each for a different Zipmex entity. While two of the entities are incorporated in Singapore, the rest are from Australia, Indonesia, and Thailand.
The filing has automatically granted the exchange a 30-day moratorium period or until the Singapore court decides on the application.
“It is important to note that a moratorium is not a liquidation of any company,” the exchange added.
Another Collapsing Crypto Exchange?
Zipmex is the latest troubling cryptocurrency platform after Celsius, Voyager Digital, and Three Arrows Capital. Another troubled crypto startup, Vauld also filed for protection against its Singaporean creditors.
While suspending withdrawals, Zipmex cited a combination of circumstances including market volatility and financial difficulties of its business partners. Now the troubles of the exchange look to be grimmer.
Earlier, Coinbase was interested in acquiring Zipmex, but the American exchange ended up only investing in the Southeast Asian counterpart. The investment came as a part of a Series B+ funding round of the crypto exchange that valued it at $400 million
Among all the markets it operates, Zipmex’s user base is concentrated in Thailand. The Thai Securities and Exchange Commission (SEC) is also working with law enforcement to evaluate the losses to the customers after Zipmex suspended withdrawals.
This article was written by Arnab Shome at www.financemagnates.com.