Leading cryptocurrency exchange Binance has decided to help the crypto industry by forming an “industry recovery fund” to assist strong crypto projects suffering from liquidity crises after the FTX fallout.
According to a tweet by the exchange’s CEO Changpeng Zhao (CZ), the FTX fall has taken a toll on the crypto industry and as such, the need to assist in any way he can. Although further details on the fund will be coming out soon, the exchange also invited industry players with funds, to support him to co-invest.
Furthermore, the exchange encouraged qualified projects to contact Binance Labs for proper investigation. Meanwhile, Tron founder Justin Sun and Simon Dixon, CEO of BankToTheFuture have already signaled interest in joining Binance’s initiative. Together they will assist good builders and developers to recover from the crisis.
Crypto Industry’s Response After FTX’s fall
In a bid to boost customers’ confidence after the sudden collapse of rival exchange FTX, CZ’s Binance led the initiative to declare its proof of reserves. Platforms like crypto.com, amongst others, have followed suit.
CZ in another announcement advises users to closely watch the activities of exchange-related wallet addresses as a large inflow or outflow of assets is a sign that all is not well. CZ advises users’ to also withdraw their funds into a non-custodial wallet when they notice any suspicious activities as exchanges are not supposed to move users’ funds out of the platform’s ecosystem.
While the industry is still reacting to the impact of FTX’s liquidity crunch, several organizations have launched investigations into the exchange. The financial investigators and Securities Commission of the Bahamas (SCB) has launched a probe into the bankrupt FTX on its island FTX Digital Markets Ltd.
Also, Hong Kong’s financial secretary Paul Chan has called for proper supervision and transparency when handling digital assets in the country in order to avoid other situations like FTX. Chan also said it’s important to put in place a regulatory framework that is in tune with the industry. This helps to properly manage risks and develop the crypto market.
Meanwhile, Samuel Bankman-Fried has resigned from his position as the CEO of the Bahamian crypto exchange following the exchange’s filing for bankruptcy.