In the wake of FTX’s collapse, the world’s biggest cryptocurrency exchange Binance has announced a crypto industry recovery fund. “As a leading player in crypto, we understand that we have a responsibility to lead the charge when it comes to protecting consumers and rebuilding the industry. That is why we have established the Industry Recovery Initiative (IRI), a new co-investment opportunity for organizations eager to support the future of Web3,” Binance wrote in its blog post. The exchange says it will commit $1 billion to the recovery fund, in what will be an initial commitment, and may increase the amount to $2 billion in the future if there is a need for it.
Binance has also received commitments worth $50 million from Jump Crypto, Animoca Brands, and Polygon Ventures.
The Industry Recovery Initiative (IRI) public wallet address was shared by Binance’s CEO Changpeng Zhao with Binance’s initial commitment. “We do this transparently,” he wrote. The initial commitment of $1 billion was made in Binance’s native token, BUSD stablecoin.
This fund comes at a very crucial time, to keep the crypto industry afloat following FTX’s filing for bankruptcy earlier this month, which made the exchange the latest crypto company to go bankrupt. Binance had initially wanted to acquire FTX but rescinded the decision. Since FTX’s collapse, investors’ trust in cryptocurrencies has dwindled and this has grossly affected the industry.
According to Binance, the Industry Recovery Initiative (IRI) “is not an investment fund.” It is intended to support companies and projects that “through no fault of their own, are facing significant, short-term, financial difficulties.”
Binance expects the program to last for about six months and added that “We have already received around 150 applications from companies seeking support under the IRI. Each co-investor within the IRI will have the opportunity to review potential deals and decide for themselves whether they wish to participate. We expect some deals will be invested in unilaterally and others will be co-investments with all or some of the IRI participants.” It is also accepting applications from investors to contribute to the funding. Binance will accept contributions in tokens, cash, and debt. “We expect individual situations to require tailored solutions,” Binance explained.