Zipmex, the most important digital asset exchange in Asia, has announced that it has been granted creditor protection by the Singapore High Court for a period of more than three months. This will give the company more time to handle any liquidity concerns it may have.
On July 21, ZipmexX suspended cryptocurrency withdrawals, citing the chance that the exchange’s assets could be consumed by the financial crisis threatening Celsius Network as well as crypto bank Babel Finance. ZipmexX cited this likelihood as the reason for the suspension.
Since then, withdrawals of some cryptocurrencies from Zipmex’s trading wallets have been re-enabled. These cryptocurrencies include Solana (SOL), Ripple’s XRP, and Cardano’s ADA. However, popular cryptocurrencies, such as Bitcoin and Ether, are still inaccessible.
On July 27, the company submitted five petitions for a moratorium, seeking protection from its creditors for a period of six months so that it would have time to restructure its debt.
According to Bloomberg, the Singapore High Court has issued an order protecting five different Zipmex companies from the possibility of being sued by their creditors by placing them under a debt moratorium until December 2nd. During this time, the companies will be immune from legal action from their creditors.
The most current legal action taken by the court gives them a three-month extension to prevent their creditors from initiating or continuing any legal procedures against them.
The judge was of the opinion that the corporation in question was required to conduct a meeting of its creditors as well as engage with the creditor committee.
During the exploratory time, lenders are now undertaking due diligence while court proceedings are taking place in the background.
More about Zipmex operations
Zipmex, a company that has operations in Singapore, Thailand, Indonesia, and Australia, has been in court for the past six months seeking bankruptcy protection in order to investigate its possibilities for corporate reorganization.
The cryptocurrency exchange based in Thailand is not the first cryptocurrency company to cease trading in Singapore; in fact, there have been several others.
A cryptocurrency lender Vauld, having financial difficulties, was given a three-month extension by the Singapore High Court in August to continue investigating how it might pay back its debtors.
In order to get ready for the reorganization of the firm and the potential acquisition by Nexo, Vault has asked the court for a moratorium that will last for the next six months.