Binance Co-Founder and CEO Changpeng Zhao gave several interviews on the outlook for the cryptocurrency after a turbulent few weeks in the market.
Cryptocurrency exchange Binance on Thursday announced new details about its industry recovery fund, which aims to support struggling players in the wake of FTX’s calamitous bankruptcy.
In a blog post, Binance said it would dedicate $1 billion in initial commitments to the recovery fund. It could increase that amount to $2 billion at some point in the future “if the need arises,” the company added.
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He also received $50 million in commitments from crypto-native investment firms, including Jump Crypto, Polygon Ventures, and Animoca Brands.
Binance CEO Changpeng Zhao shared public wallet address showing his initial commitment and said, “We do it transparently.” Public blockchain data reviewed by CNBC showed a balance of around $1 billion in Binance’s own BUSD stablecoin.
BUSD is a stablecoin issued by blockchain infrastructure company Paxos and is approved and regulated by the New York State Department of Financial Services, according to the Paxos website.
The fund is an attempt by Binance to keep the crypto industry afloat after controversial entrepreneur Sam Bankman-Fried’s FTX exchange filed for bankruptcy earlier this month.
Zhao has emerged as a new savior figure for the struggling industry, filling a gap left by Bankman-Friedwhose firm had bought or invested in a number of beleaguered crypto firms — from Voyager Digital to BlockFi — before its collapse.
FTX’s failure was triggered in part by a tweet posted by Binance’s CEO that drew attention to a CoinDesk report raising questions about its accounting. Since the speed of FTX liquidation two weeks ago, investors worried about a possible crypto contagion affecting all corners of the industry.
At the first court hearing for the bankruptcy case on Tuesday, an attorney for the company delivered a damning verdict against FTX and its executives, saying the company was run as the “personal fiefdom” of Bankman-Fried.
Binance said the vehicle “is not an investment fund” and is intended to support businesses and projects that “through no fault of theirs face significant short-term financial difficulties.” Zhao has previously stated that he intends to prevent further “cascading contagion effects” resulting from the collapse of FTX.
Binance said it expects the program to last around six months. It accepts requests from investors to provide additional funds.
Binance said it is “flexible on investment structure” and accepts token, cash, and debt contributions. “We expect that individual situations will require tailored solutions,” the company added.
About 150 companies have already applied for support from the fund, Binance said.
Crypto markets did not react significantly to the news. In the last hour, bitcoins was up around 0.2%, while Ether traded flat for the session.
Low transaction volumes are expected in the United States as Americans celebrate Thanksgiving.