Following a July withdrawal freeze, troubled cryptocurrency exchange Zipmex set release dates for Ethereum and Bitcoin on August 11 and August 16, respectively.
According to the notification,
We are working hard to release the balance of our customers’ Z Wallet holdings as soon as we possibly can.
We will be issuing frequent updates on our plans and timelines to release the remaining affected assets to users via each country’s official communications channels.”
On July 20, Zipmex stopped processing withdrawals from the marketplace, claiming financial difficulties brought on by its exposure to Celsius and Babel Finance. The ongoing liquidity problem in the business has both companies at its epicenter.
Following a restructuring plan, Zipmex has been preparing to engage with customers and regulators to guarantee money is recovered.
On August 2, Zipmex announced the launch of the altcoins as mentioned earlier, saying,
“We are working to guarantee that we are in full compliance when we start to release some of these tokens into your Trade Wallet starting in the middle of August.”
Liquidity crisis at Zipmex
Zipmex had a $48 million exposure to Babel Finance and a $5 million exposure to Celsius.
Money had been placed into Celsius from Zipmex’s ZipUp+ interest-bearing accounts. Then, on June 13, Celsius halted withdrawals across the platform, including from accounts connected to Zipmex, and the next day, on June 14, it declared bankruptcy.
Despite being legally prohibited from doing so, Zipmex “wrote off this deposit and absorbed it into our balance sheet.”
Similar liquidity troubles that plagued Babel Finance made these issues worse.
Zipmex decided to temporarily block transfers between both the Z Wallet and the Trade Wallet “to prevent short-term market volatility due to what was, at the time, erroneous and emerging reports on Zipmex’s exposure to Babel Finance,” the company said last week.