Thai SEC probes crypto exchange Zipmex ahead of its acquisition

• The Thai SEC is reportedly probing whether Zipmex breached local rules.
• Zipmex is being acquired by V Ventures for $100 million.

Crypto exchange Zipmex has become the subject of a probe by the Securities and Exchange Commission (SEC) of Thailand. The Thai securities regulator is probing the exchange to determine whether it breached local rules when it offered certain digital-asset products.

Zipmex’s digital-asset products under scrutiny

According to a 10 January report by Bloomberg, the Thai SEC has noted that some Zipmex’s activities may be in violation of the local digital asset business rules. The same was conveyed in a letter to Akalarp Yimwilai, the CEO of the crypto exchange. 

The SEC believed that Zipmex may have been operating as a “digital-asset fund manager without permission.” The securities regulator has given the crypto exchange till 12 January to provide clarification on this matter.  

Zipmex’s ZipUP and ZipUP+ programs are the products under question. These products have been offered to the exchange’s clients since October 2020. Both products were managed and operated by Babel Finance. Clients of the exchange could earn a return on their tokens with these programs. 

Probe amid the acquisition of Zipmex by V Ventures

The probe by the Thai SEC comes at a rather crucial time for Zipmex. The Bangkok based crypto exchange is currently being acquired by V Ventures, which is a subsidiary of Thoresen Thai Agencies Pcl. 

The acquisition is reportedly worth $100 million and will give V Ventures a 90% stake in the crypto exchange. It is essentially a bailout for the exchange’s customers who have been struggling to get their funds ever since the exchange suspended withdrawals in July 2022.

Due to a combination of circumstances beyond our control including volatile market conditions, and the resulting financial difficulties of our key business partners, to maintain the integrity of our platform, we would be pausing withdrawals until further notice.

— ZIPMEX (@zipmex) July 20, 2022

The Thai SEC had issued a warning to investors looking to make a deal with the troubled crypto exchange last month.

The regulator stated:

“The SEC received complaints from Zipmex customers that its privacy agreement is unclear and unfair, and the SEC shares this view. We also found these personal agreements lack information that is material to the customer’s decision.”