Zipmex in talks with potential investors after pausing withdrawals last week

Zipmex, one of Asia’s leading digital assets exchanges paused customer withdrawals last week citing “a combination of circumstances beyond our [Zipmex] control”. Only a few days later on July 24, the company announced its discussion with potential investors have progressed significantly, with one of them looking to buy out the firm having offered a memorandum of understanding (MOU) – a non-binding agreement that is often seen as a starting point for negotiations.

📢 Important Announcement 📢
Our conversations with various interested parties have progressed significantly. One of those parties has offered terms in an MOU which includes confidentiality obligations so as to be able to commence Due Diligence. #zipmex
— ZIPMEX (@zipmex) July 24, 2022

The MOU includes confidentiality obligations allowing the potential buyer to do their Due Diligence before sending in an offer. Although no further details of the discussion were shared publicly, the MOU is seen as the first step of a merger or acquisition as it enables the potential buyer to dig deeper in the company’s financial statements.

Zipmex paused customer withdrawals on July 20, and stated that its key business partners are experiencing financial difficulties due to various factors including the volatile market conditions.

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

Later, the company stated it was extending the maintenance period and planned to re-enable withdrawals and deposits for Trade Wallet users on July 21 2022, but trading was to remain disabled until further notice. Claiming that the security of its customers is the number one priority at Zipmex and it “strives to provide the most secure platform possible”, the company reminded its clients that its customer support team is available over live chat 24/7.

On July 21, as customers were anticipating the restart of withdrawals through Trade Wallet, the company announced it is extending the maintenance period until 22 July 2022. The reasoning behind the maintenance extension was said to be prevention of technical issues. Withdrawals were to be enabled “once we’re back”. In the twitter thread Zipmex once again repeated that the security of customers’ assets is its number one priority and once again reminded its users that the customer support team is available 24/7.

📢Important Announcement 📢
To prevent any technical issues, we are extending our maintenance period for Trade Wallet until 22 July 2022 (GMT+7).

We are working hard to bring back the Trade Wallet function as soon as we can. Withdrawals will be enabled once we’re back. pic.twitter.com/o0d0h4PuNj
— ZIPMEX (@zipmex) July 21, 2022

On the following day, Zipmex finally met its obligations and restarted withdrawals for Trade Wallet users, unlike Z Wallet transfers, as well as deposits and trading which remain disabled “until further notice”.