Cryptocurrency exchange Zipmex Thailand announced that it is suspending crypto trading until early next year. Following this development, the local token of the stock exchange, ZMT, came down the stairs.
Zipmex announced that it would suspend transactions, the token fell hard!
The cryptocurrency platform wrote that the decision was taken to ensure proper compliance with the criteria set by Thailand’s Securities and Exchange Commission (SEC). In this context, Zipmex made the following statement:
Dear customers, Zipmex Limited wishes to ensure the smooth and harmonious conduct of the company’s business activities in accordance with the criteria established by the Securities and Exchange Commission (SEC) of Thailand. Therefore, the company is required to temporarily suspend all types of digital asset trading and deposits, effective from 13:00 on November 25, 2023.
Following this development, the local token of the stock exchange, ZMT, started to decline. Following a gradual downward path, the token dropped from $0.008761 to $0.007351. At press time, ZMT was trading down 15.5% on a daily basis.
Cryptocurrency exchange gave up to 14 days for withdrawals
Zipmex Thailand stated that the withdrawal process for digital assets can take between 7 and 14 days. It also noted that customers must provide supporting documentation to verify their identity and account ownership. The exchange, which is headquartered in Singapore and operates in Thailand, Australia and Indonesia, is currently facing penalties from the Thai SEC.
The penalties relate to allegations that Zipmex Thailand improperly used a digital asset custody service and referred customers to Singapore-based exchange Zipmex Pte, creating a conflict of interest. Meanwhile, Zipmex also suffered losses due to cryptocurrency lenders Babel Finance and Genesis. After this he faced difficulties repaying creditors. A planned $100 million acquisition of Zipmex earlier this year fell through when the buyer, reportedly V Ventures, pulled out of the acquisition.
How did Zipmex collapse?
The platform faced a liquidity crunch following its exposure to troubled cryptocurrency lender Babel Finance. Then, last summer, it announced that it had stopped withdrawals due to volatile market conditions. In August last year, Bloomberg reported that Zipmex was planning to meet with potential investors and Thailand’s financial regulator to discuss a rescue plan.
In November, the platform was in advanced talks with venture capital fund V-Ventures regarding the sale of a majority stake. However, cryptokoin.com As we reported, these talks did not reach a conclusion. Earlier this year, Thailand’s SEC placed Zipmex under review. The regulator said it was investigating whether it violated local rules when offering certain cryptocurrency products.
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