Will users’ Bitcoin survive through Zipmex’s 3-month creditor protection?

Sahana Kiran
Source – Unsplash

The bear market and the downfall of Terra instigated the downfall of an array of crypto projects. While some had already started abandoning the market once Bitcoin plummeted below $20K, the dramatic collapse of crypto lending firms scared off some others. Asian crypto exchange, Zipmex seemed to be in trouble after it abruptly halted withdrawals in July. Now, bringing respite to its woes, the Singapore High Court granted a three-month creditor protection to the firm.

Following its involvement with Babel Finance and Celsius, Zipmex emerged as one of the worst-hit crypto platforms. After suspending withdrawals citing liquidity issues, the firm yearned for protection from its creditors. Justice Aedit Abdullah of the Singapore High Court decided to give five of Zipmex’s entities a moratorium until the 2nd of December 2022. This includes Zipmex, Zipmex Asia, Zipmex Thailand, Zipmex Indonesia, and Zipmex Australia.

With this, the entities mentioned above could dodge lawsuits from their creditors.

It should be noted that the exchange sought five-month protection from its creditors. In the meantime, Zipmex hopes to chalk out a restructuring plan.

Of late, Singapore seems to be coping with circumstances comparable to these. The period of protection from creditors for crypto companies is only three months, and the Judge gave Vauld an identical arrangement earlier this month.

Here’s what’s happening with Zipmex

Just last week, Zipmex decided to resume its Bitcoin and Ethereum withdrawals partially. Z wallet holders were allowed to withdraw these assets between 11 and 16 August. Withdrawals for altcoins like Solana [SOL], XRP, and Cardano [ADA] were also available.

Meanwhile, the firm’s shareholders weren’t too pleased with the events unfolding. Certain shareholders of Zipmex reportedly expressed the need for Marcus Lim, the firm’s Chief Executive Officer, to step down.

While the community eagerly awaits to witness the fate of Zipmex, customer funds were the primary concern of many.