Digital asset exchange Zipmex has filed for an extension from a Singaporean court that would halt its creditors from instituting legal action against the troubled firm.
In a statement, Zipmex noted that delays of tranche payments from an investor had derailed the company’s plans at repaying its creditors. Under the new development, the exchange filed for a two-month moratorium extension which it says will use to explore other options.
“The hearing date has yet to be fixed by the Court. The Company plans to use this period to find a solution, to the best of its ability, for the reopening of Z Wallet,” the announcement read.
Things seems to be falling in place for Zipmex after the Court approved its scheme of arrangement that guaranteed the withdrawal of deposits by creditors. However, things began unraveling at the seams following financial trouble with its investor, with Zipmex noting that it is “aware of the impact” that the investor’s decision could have on repayment plans.
Aside from delaying the tranche payment, Zipmex also noted that the investor had asked the firm to “modify the investment amount,” a decision that could affect the scheme of arrangement. Zipmex further revealed that the investor says it will not be bound by the terms of the SSA and requires repayment of its working capital loan.
Zipmex notes that in addition to the application for a moratorium, the exchange is currently shopping for new investors “in order to maximize returns for customers.”
While Zipmex failed to name the investor that upended its plans, all fingers point toward V Ventures, a venture capital firm with plans to acquire a majority stake in exchange for $100 million. In late March, V Venture missed the deadline to make a $1.25 million payment, forcing Zipmex to close the curtain on its technology unit.
Despite the missed payment, Zipmex announced it had a healthy cash reserve to continue normal operations and pay employee salaries in Indonesia, Singapore, and Thailand.
Bankruptcy protection from the courts
Zipmex had to seek court protection from thousands of aggrieved creditors following a liquidity crisis that saw that firm halt withdrawals on deposits. Significant exposures to Babel Finance and Celsius Network triggered the rough patch.
Since the first three-month moratorium grant in August 2022 from Singapore’s courts, Zipmex has filed for additional bankruptcy protection against lawsuits. However, the moratorium has not stopped Thailand’s Securities and Exchange Commission (SEC) from probing the exchange over the alleged offerings of unregistered securities.
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