Zipmex Nears Liquidation of Assets as VC Bails Out
- Crypto exchange Zipmex wrote a letter to venture capital firm V Ventures, telling them that the company is on the verge of liquidating assets.
- V Ventures was supposed to send a payment worth $1.25 million to the crypto exchange, which it missed due to unknown reasons.
- The company said that without the additional money, it will have to suspend payrolls as well as liquidate its Zipmex Technology unit.
- The exchange secured a buyout deal from V Ventures as per which the VC firm will acquire 90% of Zipmex Asia and provide $30 million in cash.
Zipmex, a crypto platform that allows investors to buy, sell, and trade Bitcoin (BTC) and other cryptocurrencies, got into trouble last year following the collapse of multiple crypto companies, and it seems that the company has once again landed in trouble despite a VC buyout. According to a letter sent by the company to venture capital firm V Ventures, the crypto platform is very close to liquidation of assets.
As per a report from Bloomberg, V Ventures was supposed to send a payment worth $1.25 million to Zipmex which was supposed to be the working capital for the crypto exchange so that it doesn’t have to halt operations or liquidate its assets. The payment was supposed to be due on March 23, and it seems that the crypto exchange would not be able to sail into clear waters without the capital injection.
In a letter sent to V Ventures, Zipmex said that without the additional money, which is the fourth payment to be made to the crypto exchange based in Singapore, it will have to suspend payrolls as well as liquidate its Zipmex Technology unit. However, the letter added that employees in Thailand, Singapore, and Indonesia were still covered, and it is crucial to note that the crypto firm also has operations in Australia.
As reported earlier by Bitnation, Zipmex secured a buyout from V Ventures, a subsidiary of the SET-listed shipping company Thoresen Thai Agencies Plc., last year. According to the deal, the VC firm would send around $30 million to the crypto exchange, while the rest of the amount would be transferred in crypto coins. Interestingly, as per the acquisition deal with V Ventures, Zipmex Asia will sell 90% of itself to the VC firm.
The crypto exchange filed for bankruptcy last year and halted withdrawals in July, following the collapse of the Terra ecosystem and the Celsius bankruptcy. It is also crucial to note that the exchange’s deal with Coinbase, the largest crypto exchange in the US, fell through. Moreover, Zipmex was experiencing liquidity issues due to the collapse of Babel Finance, a crypto firm that owed the exchange close to $48 million.
Babel Finance halted withdrawals in June 2022, which resulted in troubles for Zipmex. Additionally, the crypto firm had a $5 million exposure to the Celsius Network. It is important to mention here that the bankruptcy court has given approval to Celsius to process withdrawals.