Crypto Exchange Zipmex Asks for Rescue Financing

Thai crypto exchange Zipmex is headed to court after suspending withdrawals earlier this year.

According to a document posted on its website Saturday and titled “Update on Moratorium Applications in Singapore,” the company said it will be in court in Singapore Friday (Dec. 23) for a hearing on its “application for super-priority for rescue financing.”

Meanwhile, CoinDesk reports that the crypto exchange is preparing a recovery process with the goal of reactivating customer withdrawals, citing a person familiar with the matter.

The report says the plan is subject to approval by the company’s creditors and will see Zipmex offer “a more administratively light solution” in the form of a private settlement between the exchange and its customers, the source said.

Zipmex, which services crypto traders in Indonesia, Australia, and Singapore, suspended customer withdrawals in July.

“Due to a combination of circumstances beyond our control including volatile market conditions, and the resulting financial difficulties of our key business partners, to maintain the integrity of our platform, we would be pausing withdrawals until further notice,” it announced on Twitter.

Despite this year’s shaky crypto market, Zipmex’s problem was not simply market volatility, but also Babel Finance’s default on a million loan. Babel Finance froze withdrawals in June, citing “unusual liquidity pressures.”

The news comes as cryptocurrency proponents are reconsidering their investments following the demise of the FTX exchange and the broader downturn in the market, which led investors to pull close to $20 billion from crypto asset funds last month.

Meanwhile, the world’s largest crypto exchange, Binance, continues to deal with difficulties, PYMNTS wrote last week.

The company recently saw billions of dollars of customer outflows, as well as word that Mazars, the firm hired by the platform, is ceasing all future crypto accounting operations as a result of the public pushback and criticism it got from its work on Binance’s finances.

“That now-infamous proof of reserve report, which was previously made public by Mazars, is no longer available on the firm’s website,” PYMNTS wrote Friday (Dec. 16).

“Blockchains are public, permanent records,” tweeted Binance founder and CEO Changpeng Zhao (CZ), presumably in response to the news. “It’s the most auditable ledger.”

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