Binance to Create Consortium amid Dwindling Trust in Crypto Industry

The Binance exchange has taken it upon itself to restore the faith that investors once had in the crypto industry. The world’s largest cryptocurrency exchange by trading volume is putting together a consortium of crypto-based companies, per CoinDesk report.  According to sources familiar with the plans, several eligible companies have already been onboarded to the consortium founded by Binance. However, many more are still expected to join in as time progresses. Among those who have already joined the Binance consortium, there are firms that range from blockchain analytics to crypto exchanges, and some individual projects as well. 

Meanwhile, a source who spoke on the condition of anonymity also hinted that Binance might be ready to take on a more active role in coming regulations. 

The global crypto industry has not had the best of runs in a while. It was a difficult year in 2022 that saw massive losses of funds and various firms collapsing. And as a result, it is expected that this year will usher in an era of tougher regulations. 

For this reason, Binance will use the consortium to work hand-in-hand with global regulators while also portraying the industry as advanced, willing, and ready to combat criminal elements.

Binance Aims to Curb Contagion Issues with Its Consortium

Per the source, the consortium was formed to correct previous anomalies in the industry. For instance, the way the former FTX boss Sam Bankman-Fried wielded power in crypto, was “unhealthy”, says the source. He added:

“[The creation of the group is] also to ensure there’s a mechanism in place to call out shortcomings and bad behavior in the industry, and help avoid larger contagion issues.”

Meanwhile, it’s worth mentioning that Binance is not the first firm to consider a self-regulatory body such as this.  Back in 2019, Gemini publicly aired a similar opinion and has been vocal about such efforts ever since.

As of publication, there is no official statement from the leading exchange yet. However, the source also confirms that the consortium will not be run by Binance, but in a “decentralized manner”.