Binance’s Co-founder & CEO Changpeng Zhao has specified several interviews discussing the outlook for cryptocurrency following a turbulent couple of weeks in the market.
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Cryptocurrency exchange Binance on Thursday announced new details about its industry recovery fund, which aims to prop up struggling actresses in the wake of FTX’s calamitous bankruptcy.
In a blogpost, Binance said it will devote $1 billion in initial commitments to the return fund. It may increase that amount to $2 billion at a point in time in the future “if the need arises,” the company added.
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It has also received $50 million in commitments from crypto-native investment firms including Jump Crypto, Polygon Chances, and Animoca Brands.
Binance CEO Changpeng Zhao shared the public wallet address showing its initial commitment and averred: “We do this transparently.” Public blockchain data reviewed by CNBC showed a balance of around $1 billion in Binance’s own BUSD stablecoin.
BUSD is a stablecoin question majored by blockchain infrastructure firm Paxos and is approved and regulated by the New York State Department of Financial Services, according to Paxos’ website.
The ready money is an attempt by Binance to keep the crypto industry afloat after controversial entrepreneur Sam Bankman-Fried’s exchange FTX filed for bankruptcy earlier this month.
Zhao has arose as a new savior-like figure for the ailing industry, filling a gap left by Bankman-Fried, whose firm had bought or invested in a number of beleaguered crypto resolutes — from Voyager Digital to BlockFi — prior to its collapse.
FTX’s failure was triggered in part by a tweet posted by Binance’s CEO which pulled attention to a CoinDesk report raising questions over its accounting. Since FTX’s rapid winddown two weeks ago, investors receive fretted over a possible crypto contagion affecting every corner of the industry.
In the first court hearing for the bankruptcy receptacle on Tuesday, a lawyer for the company gave a damning verdict of FTX and its leadership, saying the company was run as the “personal fiefdom” of Bankman-Fried.
Binance said the carrier “is not an investment fund” and is intended to support companies and projects that, “through no fault of their own, are facing significant, needful of term, financial difficulties.” Zhao has said previously it is his intention to prevent further “cascading contagion effects” advance from FTX’s collapse.
Binance said it anticipates the program will last around six months. It is accepting applications from investors to role in additional funds.
Binance said it is “flexible on the investment structure” and is accepting contributions in tokens, cash and debt. “We upon individual situations to require tailored solutions,” the company added.
Around 150 companies have already appropriate for support from the fund, Binance said.
Crypto markets didn’t react significantly to the news. In the past hour, bitcoin was up nearly 0.2%, while ether was trading flat for the session.
Thin trading volumes are expected in the U.S. as Americans celebrate the Thanksgiving time off.