The High Court of Singapore has given Zipmex, a cryptocurrency exchange firm, permission to temporarily halt its business operations for a period of three months. During this time, creditors will be barred from taking legal action against the corporation since they won’t have the standing to do.
By giving creditor protection to five of the businesses it owns and operates, the broker will be able to continue serving its existing customers while reorganizing its operations to meet its clientele’s needs better.
The embargo that has been in place between the five firms is expected to come to an end on December 2, 2022. This follows an official Zipmex statement issued earlier today. The organization is obligated to provide the court with regular updates on its activities to reconstruct, as well as its current financial status.
The court has also ordered Zipmex to hold a “town-hall-style meeting” within a month from today to inform investors and creditors of the implications of these proceedings.
As previously announced:
“Creditors and customers will be provided with regular updates on the progress of the restructuring on a monthly basis and will be extended copies of any court documents filed, which will be shared to creditors via protected Dropbox links as per our previous announcements”.
After initially announcing that it was going to move to seek protection against creditors as part of its endeavor to resolve its liquidity crunch, the court’s approval of Zipmex’s application for a moratorium occurred roughly 18 days after.
Amid Calls for the CEO’s Resignation, Zipmex Holds Talks with Potential Investors
Some of Zipmex’s most notable clients have defaulted on their debts, thus the crypto exchange has been in talks with numerous companies who may be interested in investing in the ailing exchange as part of its restructuring attempts to shore up its finances.
According to reports, the corporation has purportedly signed two memorandum of understanding (MOU), both of which have led to new financial investments for the company. Though, before moving through with their investments, the parties concerned are still executing due diligence procedures.
The Executives of Zipmex Have More to Say Regarding Their Previous Statements Concerning the Collapse of the Company
On August 2, a statement from Zipmex’s administration sought to shed light on the events leading up to the company’s decision to halt all withdrawals in July. The corporation announced its transactions with defunct cryptocurrency lending platform, Celsius Network, in a news release.
Zipmex was disadvantaged by Celsius’s resolution to halt all withdrawals and was obliged to write off deposits it had with the cryptocurrency platform after going bankrupt. The amount of money that Zipmex had with Celsius was not specified.
Furthermore, the company stated that it was vulnerable to the failure of the cryptocurrency firm Babel Finance, which is situated in Hong Kong. However, the company did not offer any specifics regarding the amount of money held with the firm too.
The company’s management explained their decision to engage in commerce with the two companies by asserting that they were supported by “extremely reputable investors.” Additionally, the management cited the most recent budget rounds that both Celsius and Babel Finance had completed as pertinent details that bolstered the authenticity of both companies.
Zipmex made some progress in getting customers’ assets for Solana (SOL), Cardano (ADA), and XRP out to them (XRP). At the moment, customers can take out 100% of what they have in their Z Wallets.
Even though it’s a small step, the company says they are sure it’s in the right direction. In their words:
“we realize many users will still have some BTC, ETH, and stable coins remaining in Z Wallet. We are working to ensure that we are in full compliance as we start to release some of these tokens into your Trade Wallet starting in the middle of August.”
