Zipmex, a Thai crypto exchange currently facing financial distress, has proposed a restructuring plan that includes paying its creditors a fraction of their original claims. According to Bloomberg, the exchange is offering its creditors “about 3.35 cents” on the dollar of their initial claims.
This offer forms a key part of the company’s restructuring strategy as it grapples with $97 million owed to its customers.
Restructuring Proposal And Creditors’ Response This restructuring proposal, while offering some relief, falls significantly short of the total amount owed. Zipmex’s move to offer such a percentage of repayment reflects its current financial challenges.
The company’s CEO, Marcus Lim, has refrained from confirming the exact details of this restructuring plan but has noted discrepancies in the figures reported by the media.
According to Bloomberg, major creditors of Zipmex have expressed their discontent with the proposed repayment plan. They call for an independent review of the company’s assets and liabilities, indicating a lack of confidence in the figures.
Furthermore, the proposal suggests increasing the repayment from 3.35 cents to 29.35 cents per dollar, but this is “contingent on the recovery” of the company’s financial status.
Zipmex’s Struggle For Stability Zipmex’s financial woes became public in August 2022 when it filed for bankruptcy protection in Singapore, citing difficulties stemming from its $53 million exposure to crypto lenders Babel Finance and Celsius. This move came after the exchange suspended withdrawals in early July.
In the ensuing months, Zipmex has faced ongoing challenges, navigating through a complex financial landscape. The exchange has repeatedly petitioned the Singaporean court for extensions on its debt moratorium, reflecting the precarious nature of its financial standing.
The anticipation surrounding the outcome of the creditors’ vote on the proposed restructuring plan, scheduled for early December as disclosed by Bloomberg, underscores the critical juncture at which Zipmex finds itself.
Adding to these complexities, Zipmex recently announced a pause in its trading operations in Thailand. This decision, effective from November 25, 2023, at 1:00 PM, was taken to ensure compliance with the regulatory framework set by Thailand’s Securities and Exchange Commission (SEC).
The official statement from Zipmex elaborated on the need for this suspension, emphasizing adherence to the SEC’s regulations and criteria. In light of this suspension, the exchange has advised its customers on alternative withdrawal procedures. The company said in the statement:
After January 31, 2024, when the company suspends withdrawals through the website and mobile application, customers are required to contact Customer Support for withdrawals.
The global crypto market cap value on the 1-day chart. Source: Crypto TOTAL Market Cap on TradingView.com Featured image from Unsplash, Chart from TradingView
Sign Up for Our Newsletter! For updates and exclusive offers enter your email.
Samuel Edyme Edyme is a writer, a content writer that specialises in writing about the crypto realm. Asides Bitcoinist and NewsBTC, Edyme’s writing has been featured in top sites such as Blockchain.News, CoinMonk, Blockchain Reporter, Bitcoin Insider among others.