Thailand’s regulator will investigate whether Zipmex followed local standards when offering products and services to clients.
Thailand’s Securities and Exchange Commission (SEC) is apparently investigating the insolvent cryptocurrency platform Zipmex.
The watchdog will investigate whether the latter violated any domestic regulations when providing digital asset services and products.
According to Bloomberg, Thailand’s top financial regulator will investigate the bankrupt Zipmex for breaking local regulations and operating a “digital-asset fund manager without permission.”
The SEC will look into the platform’s ZipUP and ZipUP+ programmes, which allowed users to earn interest on their investments.
Previously, the watchdog issued a warning notice to Zipmex CEO Akalarp Yimwilai. The cryptocurrency company has until January 12 to shed more light on its activity over the years in order to avoid regulatory inquiry.
The corporation was one of the most severe sufferers of the lengthy bear market. It halted user withdrawals in July of last year, citing uncertain market conditions, and disclosed a $53 million exposure to faltering cryptocurrency platforms Babel Finance ($48 million) and Celsius Network ($5 million).
Zipmex began talking about potential takeover possibilities with “interested parties” who could propose a rescue plan. It also requested meetings with the SEC to discuss an eventual recovery strategy and a multi-million dollar fundraise to reimburse some customers.
Despite its attempts, Zipmex was unable to resolve its problems and filed for bankruptcy. The company was one of Asia’s largest cryptocurrency exchanges, with offices in Thailand, Singapore, Indonesia, and Australia.
At its peak, it had over two million customers and provided access to assets such as Bitcoin (BTC), Ethereum (ETH), Ripple (CRP), and its Zipmex token (ZMT), which has dropped more than 70% since the company reported its issues last summer.
In comparison to its all-time high of $5.30, the current valuation of about $0.17 reflects a staggering 96% drop.
According to some sources, the Singapore-based investment firm V Ventures has been in “advanced talks” with Zipmex about a prospective takeover arrangement.
If the acquisition is completed, V Ventures will own 90% of the distressed organisation. According to reports, the investment firm would pay $30 million in cash and the rest in cryptocurrencies. According to the court hearing, the digital assets will be used to unfreeze clients’ wallets by the end of the first quarter of 2023.