The TON Foundation’s rescue fund will help projects experience liquidity problems amid the recent collapse of the crypto exchange FTX.
The TON Blockchain platform, initially developed by social media giant Telegram, is now on a new journey in the crypto space. On Wednesday, November 30, the stewards of the TON network announced a new rescue fund with an initial commitment o $126 million.
The TON network said that the fund will help projects experience liquidity problems amid the recent collapse of the crypto exchange FTX. The aim behind launching this rescue fund is to attract more projects towards the ecosystem.
Thus, the TON Foundation is willing to play its part to effectively reduce the knock-on effects triggered by the dramatic fall of FTX. Besides, the Foundation disclosed that the rescue fund is backed by DWF Labs, Darley Technologies, Hexa Capital and TONcoin Fund Ecosystem Partners. Speaking on the development, Nan Wang, TON Foundation investment associate, told CoinDesk:
“We want to attract builders organically who are convinced by TON’s fundamentals. We are not necessarily buying out distressed assets … However, we are willing to support top founders and projects slightly impacted by recent events.”
Crypto Rescue Funds
The recent collapse of giants like crypto exchange FTX has sent shockwaves across the crypto space. A company with a $32 billion valuation and over 1.2 million registered users went entirely bankrupt in less than a week’s time.
The impact of FTX collapse is huge as the contagion has spread to other crypto firms as well. With huge deposits with FTX, crypto lender BlockFi had to file for bankruptcy earlier this week. Another crypto lender Genesis Global is facing a massive liquidity crunch amid huge withdrawals.
As a result of this, some of the top industry players have come forward to establish a crypto rescue fund. Binance chief Changpeng Zhao was among the first to pitch for the crypto rescue fund. The crypto giant has already pledged $1 billion to the rescue and a few other players have also joined. Binance said that the goal of the rescue fund will be to help fundamentally strong crypto projects that face the heat from other’s fraudulent activities.
However, the TON Foundation’s rescue fund will be, however, different from Binance’s rescue fund which seeks to buy distressed assets.
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