Zipmex Resumes Withdrawals, Writes off Celsius’ US$5 Million Loan

Singapore-based cryptocurrency exchange Zipmex announced that it will resume trade wallet withdrawals for its global and Singapore users.

The firm added that it is working on reenabling the withdrawal functionality to all users who have assets in their Z-wallet (subscribers to ZipUp+).

On Wednesday evening, Zipmex had instituted a pause on platform-wide withdrawals “in order to protect its customers and to ensure its products remain viable and safe”.

Zipmex said that due to current macroeconomic conditions and the recent fallout in the crypto space from recent events concerning Celsius Network, 3AC, Babel Finance, and others, its CeFi product has recently been exposed to defaults from two of its institutional borrowers.

Since the beginning of this year, the company had reportedly been able to retrieve the majority of these funds and assets historically deployed with its various partners.

As of the 21st of July, Zipmex reports that it is currently owed a net amount of US$48 million by Babel Finance and US$5 million by Celsius Network.

Zipmex said in a statement,

“When the news broke on Wednesday, we were already in discussion with Babel Finance on ways to resolve this liquidity situation. These discussions are ongoing. We are currently evaluating our options, based on the outcomes of these negotiations.

Dialogue between Zipmex and Babel Finance remains open and we are committed to a solution. Our loan to Celsius Network was minimal and we intend to write off this loss against our own balance sheet.”

Zipmex is considering capital raises and internal restructuring moving forward. The company said in a tweet that it is in discussions with several interested investors but did not divulge any further details on the matter.

📢 Important Announcement 📢
Our conversations with various interested parties have progressed significantly. One of those parties has offered terms in an MOU which includes confidentiality obligations so as to be able to commence Due Diligence. #zipmex

— ZIPMEX (@zipmex) July 24, 2022