Crypto Woes deepen as Celsius, Babel Links Hit Another Company
Zipmex Exchange, a Cryptocurrency Exchange that operates in Singapore and Thailand market, halted withdrawals from its exchange as the fallout from a series of defaults spreads further throughout the Digital-currency Industry.
The Asian crypto platform is the latest to encounter financial hardships stemming from dealings with troubled Cryptocurrency lenders such as Babel Finance and Celsius Network Ltd. Zipmex Exchange has exposure of around $48 million to Babel and $5 million with Celsius, it said on its Facebook page on 25th July.
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The post mentions that the company is exploring all available options through its channels including fundraising, legal action and restructuring.
The exchange is also in discussion with new investors to raise funds for a “bailout,” exchange is Thailand operations Chief Executive Akalarp Yimwilai said in a video on the exchange is YouTube channel that has since been removed.
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Zipmex exchange joins other struggling Cryptocurrency lending platforms with operations in Singapore, including Three Arrows Capital and Vauld, even as crypto regulators in the city-state tighten rules to ring-fence retail buyers and sellers from volatile digital currencies. The Monetary Authority of Singapore said last month that it will broaden regulation around cryptocurrency to cover more activities amid a series of business failures in the industry.
“Babel Finance is actively working with Zipmex exchange on possible solutions and will try to avoid customer is losses as much as possible,” a spokesperson for the Hong Kong-based company said in a WeChat message.
Web of Debts
Zipmex exchange has a license for trading Digital Asset from the Thailand Securities and Exchange Commission, according to its website. In Singapore, the exchange platform holds an exempted payment service provider permit, rather than a full-fledged license under the central bank is new regime for Cryptocurrency Asset Firms.
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According to a tweet sent out by the company on July 24th, Zipmex Exchange cited volatile Crypto Market conditions, and the resulting financial difficulties of its key business partners as reasons for its decision. The exchange platform later eased the withdrawals halt for its users of some products in Thailand.
The exchange is troubles underscore the perils of leveraged bets involving Cryptocurrency Exchanges, lenders and investors - a web of loans brought into public view as Celsius, Voyager and Three Arrows filed for bankruptcy.
Crypto Platforms Facing Liquidity Problems
Among Zipmex exchange is products is ZipUp+, an account that pays returns as high as 10% on deposits of tokens such as Bitcoin (BTC), Ether (ETH) and Litecoin, and those users will no longer be permitted to withdraw their tokens and money. Zipmex exchange said on its website that prospective customers aren’t protected, as the company isn’t licensed by the MAS.
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According to a notice on the exchange is website, referring to digital payment tokens, this means that user will not be able to withdraw all the money or DPTs paid to to Zipmex exchange if the its business fails.
According to its website, Zipmex exchange began operating in September 2019 and is based in both Singapore and Thailand. The company is native ZMT token has slumped about 94% from its all-time high, according to CoinGecko data.
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