The bailout plan for Zipmex, a troubled cryptocurrency exchange, fails

The $100 million buyout plan for Thailand-based crypto currency Zipmex has fallen through since its rescuer has not made a $1.25 million payment that was due on March 23rd, according to a report from Trade Algo.

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Zipmex Buyer Misses the Appointment

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The struggling exchange was saved from bankruptcy in December 2022 thanks to a $100 million takeover deal by venture finance firm V Ventures. Zipmex "has been receiving investment in three tranches so far."

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The most recent payment, which was due on March 23, hasn't been received. As a result, the cryptocurrency exchange has taken another step to protect its liquidity. In a letter obtained by Trade Algo, Zipmex stated that, "unless it gets the money," it will start liquidating its technology division and stop paying its employees.

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The letter also stated that Zipmex had money set aside to cover salaries in the interim. The buyer has not yet informed the company whether or not the most recent payment will be made in the meantime.

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How It All Began

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Business disaster at Zipmex started in July 2022 when it disclosed exposure to problematic cryptocurrency ventures Celsius Network and Babel Finance. The company reported that it was stuck with $5 million in Celsius and $48 million in Babel, respectively. It increased their losses to a total of $53 million.

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Plans by Zipmex to recover the borrowed monies from these projects fell through because they were both insolvent. It led to the Thai exchange stopping user money withdrawals and forcing it to seek bankruptcy protection. Customers in Thailand, Singapore, Australia, and Indonesia were impacted by the action.

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In August, the exchange hired a reorganization team to support its recovery strategy. Also, it started to develop the notion of an acquisition strategy to alleviate its cash flow problems. It was granted a three-month embargo extension until December 2nd during that time in order to resolve its liquidity crisis. At that point, V Ventures arrived and started to rescue the network from its financial difficulties. That eventually allowed Zipmex to restart deposits and withdrawals.

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