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Binance Plans to Raise $1 Billion for a Crypto “Recovery Fund,” and May Purchase FTX Assets

Binance Plans to Raise $1 Billion for a Crypto "Recovery Fund," and May Purchase FTX Assets

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The founder and CEO of Binance stated that the company’s crypto rescue fund will start with a billion dollars to distribute as it assumes the position of the white knight of the industry.

Changpeng “CZ” Zhao stated in an interview with Bloomberg that the fund has a “loose” structure, is publicly available on the blockchain and allows for payments from other market participants.

He stated that more information will be provided in a blog post on the Binance platform and the fund will start operations as soon as possible.

He declared, “Industry must be saved now, not in 2023.”

The team will next decide how far the $1 billion can go before perhaps adding more money, according to CZ.

“We’re going to set aside about $1 billion initially, and if that’s not enough, we’ll put in more. We can withdraw the money if there are unused funds after six months and there aren’t many projects – hopefully the industry will have recovered by then.

On November 14, the head of the stock exchange announced the first announcement of the creation of an “industry recovery fund” to support companies that “are otherwise healthy but have a liquidity problem” due to the FTX impact. At the time, both Tron creator Justin Sun and BankToTheFuture CEO Simon Dixon announced that they too would participate in the fund. However, it is not clear whether they actually participated.

Jump Crypto and Aptos Labs commit to a recovery fund

Well-known crypto companies Aptos Labs and Jump Crypto are each committing $50 million in funds to the $1 billion Industry Recovery Initiative led by Binance, according to a press release.

Venture capital firms Polygon Ventures and Animoca Brands, as well as GSR, Kronos and Brooker Group, will also join trading firm Jump Crypto and Aptos Labs, the organization behind the newly formed Aptos blockchain, in making contributions to the fund.

Binance takes aim at FTX’s woes

CZ also stated that the fund may be interested in buying some of the struggling cryptocurrency projects acquired by the now-defunct exchange FTX, but he did not specify which ones.

We should investigate their property, he declared. They made investments in various initiatives, some good and some disastrous, but I think some assets can be salvaged. When they become available, we’ll check it out.

FTX and hedge fund Alameda Research are two Sam Bankman firms from Fried’s that launched a buyout and rescue operation earlier this year after the failure of Terra and the resulting suffering in the cryptocurrency sector.

Because of the risk, cryptocurrency lender BlockFi is now considering starting its own bankruptcy procedure after taking a loan from FTX.US during the summer. It has already discussed possible assistance with Binance.

Voyager Digital is currently looking for a new buyer after accepting FTX’s $1.4 billion offer to buy its struggling businesses in September.

SBF claimed back in September that FTX had a billion dollars set aside for additional purchases. There was even speculation that he was considering buying publicly traded Robinhood trading software at one point.

Despite Binance’s CEO previously inadvertently criticizing FTX’s strategies in a blog post in June, CZ now fills the role of industry savior following SBF’s fall from grace.

“Don’t continue to support poor businesses, he advised at the time. Let them fight.”

Binance.US Drops Bid on Crypto Lender Voyager According to CZ

Changpeng Zhao also announced that the US arm of the exchange will make a new bid for defunct FTX’s planned acquisition of cryptolender Voyager.

Zhao revealed in an interview with Bloomberg on Thursday that Binance.US is bidding for the insolvent lending site, which CoinDesk first reported last week.

“Binance.US is making a new offer for Voyager now that FTX is no longer able to honor this commitment.” he noted.

Following Voyager’s bankruptcy filing, FTX became the frontrunner to buy the lender, and Binance’s bid was reportedly held back due to fears the US government might pose a threat to national security.

Zhao said: “I believe the US national security issues were rumors spread by FTX to try to push us out of the bid. We never had any reservations to bid.”

Since Zhao was born in China but grew up in Canada, there are constant claims that Binance is a Chinese company. In a blog post published in September, he stated, “I’m a Canadian citizen, period.”

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