Binance CEO Changpeng Zhao (CZ) declared on Twitter that the company would establish an “industry recovery fund” to mitigate the effects of the collapse of FTX and the rest of Sam Bankman-cryptocurrency Fried’s empire.
Binance asserts that it intends to assist strong firms who are suffering a liquidity constraint, but further information is needed. In the announcement, no particular firms are named, but other industry participants are welcome to join Binance if they so desire.
The venture capital division of Binance is contacted by companies looking for funding. No information has been supplied on the size of the fund or the sorts of investments it will make.
Zhao had previously declared efforts to rescue the industry from FTX’s demise, including a non-binding offer to acquire FTX that he rejected. It is unknown how much Binance will contribute to this fund, and it is even less obvious if this sum will be adequate to mitigate the harm caused by FTX.
In light of the failure of conflicted investment business and exchange, Zhao’s suggestion that his firm participates in the remainder of the sector is absurd.
Protos has requested further information from Binance Labs and will provide an update whenever we get a response.