Zipmex Loses License During SEC Crackdown

As a result of many regulatory infractions, the Thai Securities and Exchange Commission (SEC) has revoked the business license of Thai cryptocurrency exchange Zipmex. Following persistent worries about Zipmex’s financial instability and poor management, this firm action was taken.

The SEC declared on June 11 that Zipmex’s license was revoked due to its persistent disregard for orders from regulators meant to address its management and financial problems. Zipmex ignored many warnings and failed to implement the required remedial actions. As a result, the SEC suggested that Thailand’s Ministry of Finance revoke the company’s license.

The Ministry has mandated that Zipmex halt all crypto operations immediately and ensure customers’ assets are returned within 15 days. If customers fail to claim their assets within this period, Zipmex must secure the assets within 30 days and report the entire process to the SEC. As of now, Zipmex has not issued a public response.

Regulatory Troubles and Operational Challenges

Founded in 2018 and headquartered in Singapore, Zipmex has faced significant challenges in Thailand. The exchange suspended its trading operations in November 2023 due to penalties from the SEC. The penalties were for alleged misuse of a crypto custodian service and directing customers to the Singapore-based exchange Zipmex Pte, leading to a conflict of interest. Besides Thailand, Zipmex also operates in Australia and Indonesia.

Zipmex’s regulatory woes are compounded by substantial financial losses. The exchange’s rehabilitation plan has stalled after losing over $50 million due to its exposure to the bankruptcies of Babel Finance and Celsius Network in 2022. This exposure has severely impacted its ability to recover and comply with regulatory requirements.

This license revocation is a significant blow to Zipmex, highlighting the stringent regulatory landscape for cryptocurrency exchanges in Thailand and the broader implications for its operations in other markets. The SEC’s actions underscore the importance of compliance and the consequences of failing to adhere to financial regulations.