The top crypto exchange in Asia, Zipmex, announced that it had obtained protection from any action from creditors from the Singapore High Court for more than three months, giving it additional time to address liquidity concerns.
On July 21, Zipmex halted bitcoin withdrawals, citing a potential risk that the exchange’s assets would be consumed by the same financial problem affecting Celsius Network as well as cryptocurrency creditor Babel Finance.
Since then, some cryptocurrencies like Solana (SOL), XRP by Ripple, and ADA by Cardano have resumed withdrawals from Zipmex’s trading wallets. However, popular coins like Bitcoin and Ether are still locked.
On July 27, the business submitted five requests for a moratorium in an effort to obtain six months of creditor protection so it could restructure its debt.
Bloomberg reports that the Singapore High Court has mandated a debt moratorium for each of the five Zipmex companies until December 2. During this time, they would be shielded from potential creditor lawsuits.
The court has given them a three-month delay in order to prevent their creditors from initiating or pursuing any legal actions.
The judge said the business should engage in talks with the creditors’ committee and call a meeting of creditors.
During the exploratory phase, lenders are now completing their due diligence while court procedures are ongoing.
Operations of Zipmex
Zipmex has operations in Singapore, Thailand, Indonesia, and Australia and has been in court for six months to explore its reorganization alternatives.
The cryptocurrency exchange in Thailand is not the first to halt trading in Singapore.
The struggling cryptocurrency lender Vauld received a three-month extension from the Singapore High Court in August as it continues to look for ways to pay its creditors.
In order to get ready for the company’s reorganization and potential acquisition by Nexo, Vauld has been asking the court for a six-month pause.