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Binance Commits $1 Billion To Crypto Industry Recovery Fund

Published 11/24/2022, 11:42 PM
  • Binance has announced its Industry Recovery Initiative
  • Other companies including Polygon Ventures and Animoca Brands also contributed
  • Binance's plan comes after the collapse of FTX

Binance said today that it is committing $1 billion to help companies in the crypto industry remain operational.

Binance Launches Recovery Initiative

Binance wants to revive the crypto industry.

The leading exchange wrote on Thursday that it has a “responsibility to lead the charge when it comes to protecting consumers and rebuilding the industry.”

To that end, it has established the Industry Recovery Initiative (IRI), which will allow struggling cryptocurrency companies to request financial support.

Binance has contributed $1 billion worth of crypto to the initiative and may increase that amount to $2 billion if needed. The company stated that it has already received 150 support applications from various companies in need.

The IRI is also taking contributions from other companies. Several participants have already committed a total of $50 million into the program, including Polygon Ventures, Animoca Brands, Jump Crypto, Aptos Labs, GSR Markets, Kronos, and Brooker Group.

Binance said that it expects more participants to enlist soon, adding that it is working on providing a way for traditional financial companies to join the initiative without using crypto.

Binance CEO Changpeng “CZ” Zhao commented on the initiative on Twitter, writing: “We do this transparently.” He posted the link to Binance’s initial commitment of 1 billion BUSD, which is stored at an address starting 0x043a on BNB Chain.

The program is expected to last for six months. Those who contribute funds that remain unused will be able to withdraw those funds at the end of the initiative.

Binance specified that the initiative was not an investment fund, drawing a distinction between the initiative and Binance Labs—the VC arm that the exchange uses to invest in new startups.

Binance did not explicitly mention FTX in its announcement today. However, given the timing, it is clear that the exchange’s collapse (and its resulting ripple effect on other firms) led to the fund’s creation.

This is not Binance’s sole effort to bail out the crypto industry. Recent reports indicate that the firm intends to acquire bankrupt lending firm Voyager Digital and possibly acquire loan assets belonging to Genesis Capital.

Binance also nearly acquired FTX during its collapse but walked away from the deal due to allegations that FTX had mishandled customer funds.

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