After an investor skips a monthly payment, the Asian cryptocurrency exchange Zipmex may be liquidated.
The $100 million takeover of the troubled exchange by venture capital company V Ventures fell through on March 23 due to a $1.25 million payment that was due.
According to the letter obtained by Bloomberg, Zipmex Technology Co. is in danger of going out of business because it lacks the money to pay its employees.
According to reports, Zipmex would seek advice from advisors on its next moves.
On July 22 of last year, Zipmex declared bankruptcy in Singapore after being forced to halt withdrawals due to falling cryptocurrency prices. To halt legal action against the exchange for a while, lawyers filed moratoria, which are similar to U.S. Chapter 11 filings.
The entities that have sought the moratorium relief in the applications are:
- Zipmex Asia Pte Ltd
- Zipmex Pte Ltd
- Zipmex Company Limited (incorporated in Thailand)
- PT Zipmex Exchange Indonesia (incorporated in Indonesia)
- Zipmex Australia Pty Ltd (incorporated in Australia)
Babel Finance and Voyager Digital, a defunct cryptocurrency broker that was just permitted to sell its assets to Binance.US, owe $53 million to Zipmex.
The Australian restructuring company KordaMentha, which manages the exchange’s program, requested a vote from creditors last month about a prospective takeover. Additionally, they were instructed to give any ZWallet asset amounts they believed Zipmex owed them, with the promise that any disagreements would be settled through adjudication.
Prior to signing on the dotted line, the agency advised potential Zipmex creditors to “carefully consider the agreements offered” in December. It claimed that the agreements were discriminatory because the exchange allegedly only transmitted critical restructuring information to a small group of clients.
Creditor committees to represent creditors in various markets were not established by the exchange. It said that the committees would make it more difficult for creditors to collect their money since they could need their own legal and consulting personnel.
Zipmex announced a court application to request authorization for the compensation system in a moratorium update on Wednesday. It also requested an extension of the moratorium. The courts will hear the applications on March 30.
Any creditor who wishes to attend the sessions must arrange for legal counsel with Singaporean right of audience to represent them. Those who are impacted by the filings are also welcome to attend hearings via Zoom.
In January, the Thai SEC said that it was looking into Zipmex for allegedly improperly handling cash for digital assets.