As Thailand-based cryptocurrency exchange Zipmex continues to struggle with its finances, its $100 million buyout plan has gone wrong as its rescuer has failed to make a $1.25 million payment due on March 23rd, Bloomberg reported on Friday.
Zipmex Buyer Fails to Meet Up
In December 2022, the troubled exchange was rescued from a financial mess by a $100 million acquisition plan by venture capital fund V Ventures. So far, Zipmex “has been receiving three tranches of funding.”
The latest payment, which was expected to come in on March 23rd, hasn’t been made. This has caused the crypto exchange to implement another action to maintain its liquidity. Zipmex mentioned in a letter seen by Bloomberg that it will begin liquidating its technology subsidiary and halt the payroll for the unit “unless it gets the money.”
The letter added that Zipmex has enough funds to pay salaries in the meantime. Meanwhile, the company has yet to receive a response from its buyer as to whether or not the latest payment will be made.
How It All Started
Zipmex’s business failure began in July 2022, when it revealed exposure to troubled crypto projects Babel Finance and Celsius Network. The firm noted that it had $5 million and $48 million stuck in Celsius and Babel, respectively. It brought its total losses to $53 million.
Zipmex’s plans to retrieve the borrowed funds from these projects failed as they both were bankrupt. It caused the Thai exchange to halt withdrawals of users’ funds and subsequently file for bankruptcy protection. The action affected customers across Thailand, Singapore, Australia, and Indonesia.
The exchange employed a restructuring team to aid its recovery plan in August. It also began to nurture the idea of an acquisition plan to resolve its liquidity crunches. During that time, it received a three-month moratorium extension until December 2nd to settle its liquidity crisis. That was when V Ventures came along and began rescuing the platform from its financial problems. It enabled Zipmex to eventually resume deposits and withdrawals.
