Key takeaways:
- According to CEO Changpeng “CZ” Zhao, Binance is forming an “industry recovery fund”
- The fund is designed to help crypto projects struggling with liquidity in the aftermath of FTX’s downfall
- Binance is welcoming interested parties to “co-invest” in the fund and help rebuild the crypto industry
Binance CEO wants to help crypto projects that have liquidity problems
Changpeng “CZ” Zhao, the CEO of Binance, announced on Twitter today that the company is forming an industry recovery fund designed to mitigate the negative impact of the recent FTX / Alameda Research fiasco. CZ stated that the fund is meant to lend a helping hand to projects that “are otherwise strong, but in a liquidity crisis.”
The news comes days after the FTX cryptocurrency exchange filed for Chapter 11 bankruptcy following a bank run scenario that ultimately left the exchange unable to process user withdrawals. To make matters worse, the exchange was hacked for more than $400 million on November 12. FTX CEO Sam Bankman-Fried resigned from his position in light of the recent events.
The total crypto market cap shrank by nearly 20% to $854 billion since last week, with Bitcoin and Ethereum plunging to their multi-month lows as a result of negative market sentiment. Crypto assets that had a stronger connection to the troubled exchange, namely FTX Token and Solana, are down even more, -93% and -52%, respectively.
Zhao wrote that Binance is welcoming other crypto companies that are in good financial standing and wish to “co-invest” in the recovery fund. The CEO remarked:
“Crypto is not going away. We are still here. Let’s rebuild.”
