As the crypto winter continues to bite harder, the Thailand-based crypto exchange has paused withdrawals on its platform until further notice. The exchange announced the recent development in a tweet posted in the early hours of Wednesday.
According to the tweet, a number of circumstances beyond its control necessitated the new development. The continued market fluctuations in addition to financial struggles experienced by its strategic partners informed this decision.
Due to a combination of circumstances beyond our control including volatile market conditions, and the resulting financial difficulties of our key business partners, to maintain the integrity of our platform, we would be pausing withdrawals until further notice.
— ZIPMEX (@zipmex) July 20, 2022
While the market turbulence continues to force crypto firms into making difficult decisions, the firm says the temporal halt was necessary for the integrity of the platform.
Shortly before the announcement, its CEO Marcus Lim had denied rumors that the firm is facing a financial crisis. The firm reportedly lent $100 million to troubled Babel Finance. Babel could have defaulted since Babel itself is facing a financial crisis also.
Earlier in June Coinbase made a strategic investment in the firm for an undisclosed amount. Owing to the extreme market conditions, Coinbase’s initial acquisition deal fell through leaving it to settle for a strategic investment. Coinbase is an important strategic partner according to Lim.
The exchange firm is reportedly looking for investors for its series B round that will raise its valuation to $400 million.
Zipmex established in 2019 with its base both in Thailand and Singapore has a digital asset trading license from Thailand’s regulators. It also holds a payment service provider permit rather than a full license to operate in Singapore.
Other firms that have halted withdrawals
Just like Zipmex, several firms have halted customer withdrawals in recent months following the terra-luna crash and the prevailing market downturn.
Earlier in the month, Singaporean crypto lender Vauld suspended withdrawals due to the unpleasant market situations and the financial challenges faced by the company. It also recently wrote to its creditors disclosing a $70 million deficit in its books.
London-based Nexos have since signaled interest in the firm as part of its consolidation move.