Zipmex Thailand suspends trading, faces regulatory challenges
Zipmex Thailand has suspended new deposits and trading on its exchange, citing the need to adhere to the regulations of Thailand’s Securities and Exchange Commission (SEC).
The exchange made the announcement on its Facebook page, indicating that while withdrawals will continue as normal until January 31, 2024, customers will thereafter need to seek assistance from the exchange’s customer support team for withdrawals.
“Dear customers, Zipmex Limited would like to ensure the proper and compliant conduct of the company’s business operations in accordance with the criteria set by Thailand’s Securities and Exchange Commission (SEC). Therefore, it is necessary for the company to temporarily suspend digital asset trading and deposit of all types, effective from Nov 25, 2023, at 1pm onwards,” the statement reads.
Based in Singapore, Zipmex operates across Thailand, Australia, and Indonesia, but it has come under scrutiny by Thailand’s SEC. The issues involve allegations of improper use of a digital asset custodian service by Zipmex Thailand and accusations that the company directed customers towards the Singapore-based exchange Zipmex Pte, raising conflict of interest concerns.
The exchange’s troubles are compounded by its struggle to repay creditors following losses tied to crypto lenders Babel Finance and Genesis. A potential $100 million buyout deal that could have offered some relief to Zipmex fell through earlier this year when the prospective buyer, V Ventures, withdrew.
Further complicating the situation, on January 10, Zipmex was subject to a new investigation by the SEC of Thailand over potential violations of local rules. The following day, the exchange faced a deadline to confirm or deny to the SEC whether it had been operating as a digital asset fund manager without the necessary authorization.
The SEC’s scrutiny of Zipmex is not new; it began months ago. In September 2022, the SEC lodged a police report against Zipmex and its co-founder, Akalarp Yimwilai, for alleged noncompliance with local laws. Specifically, the SEC pointed out that Zipmex failed to provide required information on digital wallets and crypto transactions as mandated by the country’s Digital Assets Act.
“To ensure that the business operations of Zipmex Company Limited (“Company”) are appropriate and compliant with the criteria set by the SEC Thailand, the company is required to temporarily suspend the trading and depositing of all types of assets, effective from November 25, 2023, at 1:00 PM onwards,” the SEC said.