Southeast Asia-focused cryptocurrency exchange Zipmex, which operates in Singapore, Thailand, Indonesia, and Australia, has filed for bankruptcy protection in Singapore, becoming the most recent victim of the worldwide decline in crypto markets.
Zipmex resumed withdrawals last Monday, one day after suspending them on July 20, and stated that company was seeking to mitigate its $53 million exposure to crypto lenders Babel Finance and Celsius. On behalf of a number of Zipmex Group firms, its solicitors in Singapore, Morgan Lewis Stamford LLC, filed 5 applications under Part 64 of Singapore’s Insolvency, Restructuring and Dissolution Act 2018 on 22 July 2022, the cryptocurrency exchange announced on Wednesday.
Under Singapore law, such a filing automatically allows corporations a 30-day moratorium or until a Singapore court rules on the application, whichever comes first.
Zipmex, which operates in Singapore, Thailand, Indonesia, and Australia according to its website, is the latest in a succession of crypto players worldwide to run into problems following a sharp sell-off that began in May with the collapse of two linked coins, Luna and TerraUSD.
Zipmex is the latest in a succession of global crypto players to experience difficulties following a precipitous drop in cryptocurrency markets that began in May with the collapse of two linked coins, Luna and TerraUSD. Zipmex follows Celsius Community Ltd. and Vauld in blocking withdrawals, leaving depositors in limbo and highlighting the dangers of leveraged bets pervading the industry.
According to its website, the crypto exchange was started in September 2019 and is based in Singapore and Thailand. According to information compiled by CoinGecko, the value of the company’s native ZMT coin has dropped by more than 93% since its all-time high in April of last year.
Several crypto companies have filed for bankruptcy or been forced to seek out emergency capital infusions. The cryptocurrency market could not recover after Terra’s collapse in May as insolvency risks hung large over major crypto lending firms, causing widespread market participant anxiety. In 2020 and 2021, the value of cryptocurrencies, resembling bitcoin, skyrocketed, however it has plummeted dramatically this year.