Zipmex Thailand, a prominent digital asset exchange, immediately halted all trading activities on its platform. This suspension, effective from November 25, 2023, marks a critical juncture for the exchange and its users, drawing attention to the regulatory environment surrounding digital assets in the region.
Compliance with regulatory standards
Zipmex Thailand’s decision to pause trading was communicated through a Facebook post on Saturday afternoon. The company stated, “Dear customers, Zipmex Limited would like to ensure the proper and compliant conduct of the company’s business operations in accordance with the criteria set by Thailand’s Securities and Exchange Commission.”
It is important to know that this suspension includes all digital asset trading and deposits, highlighting the company’s commitment to align with regulatory standards.
The move follows scrutiny from Thailand’s Securities and Exchange Commission (SEC), which previously accused Zipmex of operating outside the digital asset business regulations. In particular, the SEC noted issues with Zipmex not having a system in place to prevent conflicts of interest and inadequate risk control systems in its operations between May and July 2022.
Withdrawal processes and customer impact
While trading is halted, Zipmex Thailand has assured that customers can withdraw Thai baht and digital assets from their Trade Wallets via the website and mobile application until January 31, 2024. For ‘Trade Only’ digital assets, customers are required to contact Customer Support for withdrawals. The process for withdrawing digital assets may take between seven to fourteen days, and customers need to prepare supporting documents to confirm identity and prove ownership of their accounts.
This suspension comes amid a challenging period for Zipmex, which has faced allegations of misuse of a digital asset custodian service and of directing customers to its Singapore-based exchange, Zipmex Pte. The company also struggled financially following exposure to crypto lenders Babel Finance and Genesis, leading to difficulties in repaying creditors.
The suspension of Zipmex Thailand’s trading activities occurs in a competitive digital asset market in Thailand. Notably, Gulf Binance, a joint venture between Gulf Innova and Binance, recently received SEC approval to commence digital asset business operations. As one of the nine other crypto exchanges in Thailand, Gulf Binance is poised to begin trading in early 2024, intensifying the competition in the market. The coming months will be crucial for Zipmex Thailand as it works towards resuming operations.