The Binance CEO also requested other firms to co-invest in the recovery fund.
Binance's industry recovery fund will help projects stuck in a liquidity crisis
Photo Credit: Reuters
Binance CEO Changpeng Zhao aka CZ has revealed that his company will form an industry recovery group in a bid to reduce the negative effects associated with the fallout of FTX. Sam Bankman-Fried's FTX filed for bankruptcy on Friday after a week of seeing customers pull assets and Binance abandoning a rescue offer. Bankman-Fried and his company are under investigation by the Department of Justice and the Securities and Exchange Commission. CZ also welcomed other industry participants who would want to co-invest.
“To reduce further cascading negative effects of FTX, Binance is forming an industry recovery fund, to help projects who are otherwise strong, but in a liquidity crisis. More details to come soon. In the meantime, please contact Binance Labs if you think you qualify," tweeted Zhao.
Tron founder Justin Sun looks to support and participate in Binance CEO's initiative to recover the market. He believes it will help good builders and developers to recover from the crisis.
Other entities including Celsius' largest investor Simon Dixon like to join the fund and contribute to make it decentralised with the crypto community. Notable Twitter user in the space, Crypto King, also asked CZ if FTX qualifies as strong but in a liquidity crisis. Binance CEO replied saying that "Liars or fraud never qualify as strong projects. This is for other projects in the ecosystem."
The development arrives after crypto prices have crashed and institutional investors are losing confidence and trust after one of the largest crypto exchanges FTX filed for Chapter 11 bankruptcy.
It is also worth recalling that Binance, in October, unveiled a $500 million (roughly Rs. 61.5 lakh) lending pool for Bitcoin miners, as a combination of energy costs, low Bitcoin prices, and higher-than-ever mining difficulty strains the sector. The company said its project was designed to provide "secure debt financing services to both public and private blue-chip Bitcoin mining and digital asset infrastructure companies globally."
Get your daily dose of tech news, reviews, and insights, in under 80 characters on Gadgets 360 Turbo. Connect with fellow tech lovers on our Forum. Follow us on X, Facebook, WhatsApp, Threads and Google News for instant updates. Catch all the action on our YouTube channel.