zipmex ceo marcus lim
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Cryptocurrency exchange Zipmex has announced that it is considering a possible offer from an interested party, and that due diligence should commence. Zipmex has not specified who the interested party is.

The company has previously attracted the attention of Coinbase, and was intended for an acquisition in the first quarter of this year.

However, the deal fell through and Coinbase eventually ended up making an undisclosed ‘strategic investment’ into Zipmex as part of a Series B+ funding round. Other investors in the company include B Capital, V Ventures, MindWorks Capital, and Master Ad.

Zipmex operates in markets in the Asia Pacific region such as Singapore and Thailand, where it accounted for around a quarter of the total revenue of the Thai digital asset market. 

What’s the status on Zipmex?

Last Wednesday (July 20), it halted withdrawals. The reasons cited were the volatile market conditions, and the resulting financial difficulties of their key business partners.

Thailand’s Securities and Exchange Commission has also reportedly issued Zipmex a letter, asking it to clarify its withdrawal freeze, and questioned if the company had been using services from Celsius and Babel finance, both of which are also facing crises of their own.

Zipmex has since resumed withdrawals from its trade wallets, and has clarified that it has around US$48 million in exposure to Babel Finance and US$5 million to Celsius.

While the company is writing off the US$5 million from Celsius, Zipmex also announced in a statement that “dialogue between Zipmex and Babel Finance remains open and [they] are committed to a solution”. The company had already been in discussions with Babel to resolve the liquidity situation.

The company has also emphasised that while they do offer high yields, lending is not central to the company’s exchange operation, NFT platform, Web3, and metaverse projects.

The situation that Zipmex is facing follows the difficulties that are being experienced by the crypto industry worldwide, with many companies facing crises or laying off employees to cut costs. 

Terraform Labs nearly collapsed in May, followed by companies such as Celsius, which halted withdrawals in June, and Babel Finance, which has seen a mass exodus of its employees. Singapore-based Three Arrows Capital has also been ordered into liquidation, and its founders are currently in hiding.

Meanwhile, Coinbase has also announced plans to lay off 18 per cent of its workforce, and Bybit and Crypto.com have also announced similar plans to slash headcounts. 

A spokesperson for MAS stated that Zipmex’s application for a crypto service licence is under consideration, and that MAS would engage with Zipmex on the recent developments as part of the assessment.

Currently, Zipmex is operating under an exemption in Singapore, and the company has also said that it is cooperating with the Thai Securities Exchange Commission as well as the Indonesian government.

Only a handful of companies have received licences to operate in Singapore, despite around 200 applications.

Featured Image Credit: Zipmex

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Vulcan Post aims to be the knowledge hub of Singapore and Malaysia.

© 2021 GRVTY Media Pte. Ltd.
(UEN 201431998C.)