Binance Crypto Industry Recovery Initiative Has 150 New Applicants

UTC by Bhushan Akolkar · 3 min read
Binance Crypto Industry Recovery Initiative Has 150 New Applicants
Photo: Binance / Facebook

However, Binance’s new initiative hasn’t shown any positive impact on the crypto space yet.

With the collapse of the crypto exchange FTX, Binance chief Changpeng Zhao has been pushing for the development of a crypto recovery fund. The goal is to help fundamentally strong cash-strapped startups in such times of distress.

On Thursday, November, Binance published a blog post explaining its Industry Recovery Initiative (IRI). Binance said that IRI offers a new co-investment opportunity for organizations in the crypto space to support the future of Web3.

Binance clarifies that the IRI is not an investment fund. Besides, each participant will have to set aside committed capital, in stablecoins or other tokens, within the public addresses to ensure transparency. Binance and other parties will also review the investment opportunities and can take investment decisions independently.

Binance has already committed $1 billion to the fund and said that they can increase it to $2 billion in the future if the need arises. The official announcement from Binance notes:

“As a leading player in crypto, we understand that we have a responsibility to lead the charge when it comes to protecting consumers and rebuilding the industry. Initially, Binance will commit USD 1 billion to IRI-themed investment opportunities with an intent to ramp up that amount to USD 2 billion in the near future if the need arises”.

Some of the key players in the crypto space have also committed to participating. This includes names like Jump Crypto, Polygon Ventures, Aptos Labs, Animoca Brands, GSR, Kronos and Brooker Group. These players have announced an aggregate $50 million initial commitment to participate in the fund. Binance stated that they have received an additional 150 applications willing to participate in IRI.

Binance CZ on the Crypto Recovery Fund

Binance chief Changpeng Zhao also shared his views on the Industry Recovery Initiative. “We are going with a loose approach where different industry players will contribute as they wish,” he said.

However, Binance’s new initiative hasn’t shown any positive impact on the crypto space yet. Speaking to Bloomberg, Hayden Hughes, chief executive of social-trading platform Alpha Impact said:

“There’s too much uncertainty in the market for the recovery fund itself to be the catalyst that turns everything around. We still don’t know the extent of the contagion. But I think we are at or close to the bottom and I don’t expect markets to go down much from here.”

David Adams, portfolio manager of the King River Digital Assets Fund said:

“The market will be watching the fund’s public wallet address closely to see whether it attracts a material amount of non-Binance capital, as this will indicate how broad-based the industry support is for stabilization”.

With IRI, Zhao’s credibility remains at stake. One thing that regulators aren’t comfortable with Binance is that the crypto exchange holds licenses in several different jurisdictions, but isn’t formally based anywhere yet.

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