New details on the industry recovery fund set up by Binance, which aims to help struggling players in the wake of FTX’s devastating bankruptcy, have been made public.
Following the implosion of controversial entrepreneur Sam Bankman-exchange Fried’s FTX earlier this month, Binance is making an effort to preserve the cryptocurrency industry.
Binance industry recovery fund could expand to $2B
Binance announced in a blog post that it will first commit $1 billion to the recovery fund. In the future, “if the need arises,” it might increase to $2 billion, the exchange said.
The public wallet address of Binance’s initial pledge, which displayed a balance of around $1 billion in the company’s own BUSD stablecoin, was made public by Changpeng “CZ” Zhao, the CEO of Binance.
“We do this transparently,” CZ said.
The new white knight?
CZ is filling the hole left by Bankman-Fried, whose firm purchased or invested in a number of failed cryptocurrency startups before its demise.
However, according to Binance, the money is “not an investment fund” and is intended to aid firms and initiatives facing significant financial difficulties.
Part of FTX’s collapse was triggered by Zhao’s tweet, which drew attention to a CoinDesk article throwing doubt on its accounting.
Since FTX’s unexpected shutdown two weeks ago, investors have been anxious about a potential crypto pandemic infiltrating every facet of the market.