The world’s highest-trading exchange Binance is putting together an “industry recovery fund,” the company’s CEO said, Changpeng Zhao.
According to the Chinese, the idea is “reduce possible negative cascading effects after the fall of FTX”.
Zhao refers to the bankruptcy declared by FTX Trading on Friday, November 11, which generated the greatest upheaval in the crypto market, with widespread falls in the price of all digital currencies.
The objective is to “give support” to the projects that, although he clarified that “they are strong”, could have a “liquidity crisis”.
According to Zhao published on the social network Twitterwill announce “very soon” more details about the project.
He also told companies in the crypto industry to “contact Binance Labs if they believe they qualify” for support from the fund and that all industry players who intend to invest, along with Binance, in companies that seek financial support through the proposed fund, they are “very welcome”.
To reduce further cascading negative effects of FTX, Binance is forming an industry recovery fund, to help projects who are otherwise strong, but in a liquidity crisis. More details to come soon. In the meantime, please contact Binance Labs if you think you qualify. 1/2
— CZ 🔶 Binance (@cz_binance) November 14, 2022
FTX goes bankrupt and Binance doesn’t want to be next
FTX US and Alameda Research filed for bankruptcy along with 120 other companies in the holding companyunder the protection of the so-called chapter 11 of US law.
The news of the second largest exchange in the world generated a collapse that impacted even in Bitcoinwhich traded below 16,000 dollars and recovered to 16,600.
ethereumthe second crypto behind Bitcoin, hovered around $1,200.
Before the FTX crash, Bitcoin was trading at $20,000 and Ethereum at $1,600.
Investors who have their savings in FTX are not sure that they will get their money back.
The FTX debacle, once finalized, will be the largest bankruptcy related to the crypto ecosystem in history. A week ago, FTX was one of the titans of the industry, and Sam Bankman-Fried, its founder and CEO, was smiling in dozens of interviews.
In January 2022, FTX raised more than $32 billion in funding from Silicon Valley investors, with the CEO himself talking about his intentions to raise more for the firm to grow more.
But all that is already past, Bankruptcy will most likely end with billions lost, including those of Sequoia Capital and Thoma Bravo, two of those who bet the most on the second exchange in the world, behind Binance.
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