The Thailand Securities and Exchange Commission (SEC) has expressed concerns over the losses suffered by some users of the Zipmex exchange after the platform temporarily halted withdrawals and several other services last week, citing extreme market conditions.
Thai SEC gathers data on Zipmex users
In an announcement released on Monday, the Thai SEC said it was working with law enforcement authorities to gather data about users of the Zipmex exchange. The regulator wants to uncover how these users were affected after the exchange decided to halt withdrawals.
The SEC has also called for the affected investors to submit their details through an online platform available on the Thai SEC’s website. The regulator said that to give more convenience to the affected users, it had provided a form that could be filled with facts and lead up to the complaint process.
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Zipmex halts withdrawals after exposure to Celsius & Babel
Zipmex halted withdrawals last week, citing the volatile market conditions in the crypto market and the financial issues faced by its business associates. After the suspension of the services, there were many speculations on whether the company was exposed to Celsius and Three Arrows Capital, which filed for bankruptcy.
Zipmex reinstated withdrawals less than 24 hours after making the announcement, but this is not preventing the Thai SEC from scrutinizing the exchange. The SEC sent a letter to Zipmex requesting information on why it halted withdrawals.
The Thailand SEC also wants Zipmex to provide details on the total value of customer assets in its custody. The regulator also wants to know if Zipmex has exposure to troubled crypto lenders, namely Babel Finance and Celsius, that also halted services.
After reinstating withdrawals, Zipmex admitted that it was exposed to Babel Finance and Celsius. The amounts owed by Celsius and Babel Finance are $5 million and $48 million, respectively.
Zipmex is holding discussions with Babel to determine the best way forward. Zipmex also plans to write off the Celsius loan as bad debt as the amount is small and the crypto lender has declared bankruptcy.
Some recent reports also said that Zipmex was holding talks with interested parties for a deal that would support the exchange during the tough times. The exchange was close to securing $40 million in a Series B+ funding round before some crypto companies started to collapse.
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