The UK cryptocurrency fintech company Ziglu has collapsed with a £2 million shortfall, causing a loss of £2.7 million of users' money.
Ziglu, known for its high-yield investment products, was ordered by the UK's Financial Conduct Authority (FCA) to halt withdrawals, leading to the freezing of assets for approximately 20,000 customers.
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Ziglu used customer funds as operational cash flow, resulting in a £2 million shortfall.
Around 20,000 users have had their funds frozen, with no clear timeline for when they will regain access.
The FCA warns that cryptocurrency is still not adequately regulated, posing high risks for investors.
What incident did Ziglu experience with user assets?
CEO Mark Hipperson and the board of directors are accused of misusing customers' investment deposits, causing a shortfall of approximately £2 million.
Ziglu used users' funds as a common cash source instead of reserving them for the Boost product, resulting in bankruptcy as cash flow dwindled.
Mark Hipperson, Founder of Ziglu, 2025, reported to the High Court of England.
An investigation at the High Court of England revealed that funds in the Boost product with interest rates up to 6% were not preserved, but rather used to maintain the company's operations. When unable to continue, Ziglu applied for special administration in June 2025.
Why are Ziglu customers' assets frozen?
The UK's Financial Conduct Authority has ordered a halt to withdrawals on the Ziglu platform since May 2025 to protect users, after discovering the company was at risk of losing liquidity.
We continuously remind users that although regulations are developing in the UK, the cryptocurrency sector still carries many risks and is not fully protected.
FCA spokesperson, 2025
About 20,000 investors with a total balance of over £2.7 million were affected, including 4,000 participants in the Boost product. If the shortfall cannot be recovered, most of this money may be lost.
Details about Ziglu's Boost investment product and its impact on users?
The Boost product, launched in 2021 amid low market interest rates, promised high returns of up to 6%, attracting a large number of investors seeking superior profits.
Notably, this product lacks standard insurance like traditional savings accounts, allowing Ziglu to use the capital for business operations and lending, while also bearing the risks when investments fail.
Previously, Ziglu was close to reaching a funding agreement to ensure reimbursement for Boost investors, but these plans fell through before the FCA intervened.
What is the history of fundraising and rescue efforts for Ziglu?
The founder of Ziglu, Mark Hipperson, previously stated that the company was close to securing new funding to address the shortfall before the FCA restricted withdrawals.
Previously, in 2022, the US fintech company Robinhood also intended to acquire Ziglu for $170 million, but due to a severe drop in the cryptocurrency market, the deal did not succeed.
What will the future hold for Ziglu users?
Currently, special administrators are seeking new investors to save Ziglu, but the timing for users to regain access to their funds has not yet been determined.
Millions of pounds are still recorded in individual transactions, but the risk of losing capital remains high if the shortfall cannot be fully recovered.
Frequently Asked Questions
What is Ziglu and how did the incident occur? Ziglu is a UK cryptocurrency fintech company that faced issues misusing customer investment funds, leading to a shortfall of £2 million and halting withdrawals since May 2025. Can I get my money back from Ziglu? The chances of recovering funds are unclear; the company is in the process of seeking new investors, and most of the users' money may be lost. What role does the FCA play in the Ziglu case? The FCA identified the risk of Ziglu losing liquidity, ordered a halt to withdrawals, and supervised the special administration process to protect users. Is Ziglu's Boost product safe? Boost is not insured like a bank savings account; invested funds may be misused, posing high risks. Are there measures to avoid similar risks? Users need to choose cryptocurrency companies with clear licenses, thoroughly understand investment terms, and not put all their capital into high-yield, non-guaranteed products.
Source: https://tintucbitcoin.com/ziglu-sap-nguoi-dung-mat-27-trieu-usd/
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