Cryptocurrency exchange Zipmex has become an opportunity to straighten out liquidity issues like a court in Singapore grants the firm using more than three several weeks of creditor protection.
Singapore’s High Court has ruled to provide each one of the five Zipmex entities a moratorium until 12 ,. 2, 2022 to generate a restructuring plan, Bloomberg reported on Monday.
The experience aims to safeguard Zipmex from potential creditor lawsuits throughout the moratorium period following the exchange abruptly stopped crypto withdrawals on its platform in mid-This summer. The cryptocurrency has since started again partial withdrawals from Zipmex’s trade wallet but is yet to resume all withdrawals.
Zipmex searched for creditor protection for six several weeks subsequently after halting withdrawals, filing five moratorium applications on This summer 27. The exchange reported liquidity issues because of contact with the cryptocurrency loan provider Babel Finance, which stopped withdrawals in June.
The Thailand-based crypto exchange isn’t the first crypto firm to get a moratorium in Singapore. Justice Aedit Abdullah also granted a 3-month protection from creditors to Vauld, another local crypto firm that stopped withdrawals at the begining of This summer.
Based on some reports, Zipmex shareholders and potential investors have advised Chief executive officer Marcus Lim to step lower over management decisions that they believe have brought towards the severe cash crunch.
Related: Crypto lending platform Hodlnaut suspends services because of liquidity crisis
Cryptocurrency lending is a kind of crypto service that enables borrowers to make use of their crypto assets as collateral to obtain loans in fiat currencies such as the U.S. dollar or stablecoins like Tether (USDT). The practice enables users to obtain money without getting to market their coins and pay back the borrowed funds later on.
The crypto lending industry has faced massive liquidity issues among a significant bear market of 2022 as lenders grew to become not able to supply full liquidity on assets which were given out simultaneously. Based on some industry observers, crypto lending continues to be in a position to survive the crisis however it must eliminate the maturity mismatch problem.
