After FTX, Binance launches the recovery fund

After the collapse of the FTX exchange last weekend, this is not the first time Binance CEO Changpeng Zhao has spoken on the subject. 

The latest update is the tweet of a few hours ago, in which Binance states: 

“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.”

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

Apparently, Binance once again is not shying away from helping all the projects that are suffering from the FTX collapse and subsequent market turmoil. Indeed, CZ adds: 

“Crypto is not going away. We are still here. Let’s rebuild.”

A message of hope that replenishes some of the confidence lost in recent days even for crypto investors. 

Binance Labs: empowering the decentralized web

CZ officially declares on Twitter that anyone in trouble can contact Binance Labs to be part of the liquidity recovery fund that Binance itself is setting in motion. 

Indeed, Binance Labs identifies, invests in, and empowers viable blockchain entrepreneurs, startups, and communities by providing funding for industry projects that help grow the broader blockchain ecosystem. 

Not only that, Binance Labs is also committed to supporting rapid execution technical teams that positively impact the crypto space and build the decentralized web.

In total, the platform operates on more than five continents and twenty-five countries and is currently involved in more than two hundred projects. Active since 2018, Binance Labs has also incubated about 50 Web3-born target projects through the Binance Labs Incubation Program, including Polygon, Perpetual Protocol, Dune Analytics, and many others.

Following CZ’s tweet, we know that Binance Labs is not only a tool to empower the decentralized Web, but as of today is also a right-hand man for all projects in need. We await updates from the official Binance account to see how the rescue operation will proceed. 

Crypto on the brink of crisis after FTX: let’s see what they are 

The FTX exchange crisis has also dragged with it many prestigious cryptocurrencies that now risk a dangerous collapse as a result of market turmoil. If a colossal exchange like FTX collapses, it is normal that the confidence of all investors tends to waver. And that is exactly what has happened. 

Unfortunately, a few hours ago it was reported that Crypto.com‘s native token, Cronos, also collapsed, infected by FTX’s disastrous spiral. 

In particular, Cronos collapsed to a 22-month low. Attention is high in general towards all centralized exchanges after the deep red of one of the major players.

The CRO/USD exchange rate has slumped 28% to $0.0557, halving in value over the past week, as investors fear a potential FTX-like liquidity crisis.

Concerns about the exchange’s financial position intensified over the weekend after data showed it had accidentally sent about 82% of its Ethereum reserves, about $400 million, to a wallet linked to Gate.io in October.

Although the funds were recovered, traders said the transfer contradicts Crypto.com’s claims that all user funds are kept offline in cold wallets. 

The exchange, which also recently disclosed its cryptocurrency reserves, has drawn heat for having more than 20% of its reserves in the Shiba Inu coin meme.

CZ’s words, within the crypto world, are sacred. Even in the case of Crypto.com’s collapse, the CEO of Binance lashed out at Crypto.com, warning users to steer clear. 

Crypto.com is not the only one to suffer losses, although CRO’s losses far exceeded the declines in the cryptocurrency market in general over the past 24 hours. Bitcoin, the world’s largest cryptocurrency, fell 4% and remained around two-year lows, while Ethereum lost 6%.

Tokens from other centralized exchanges also fell: the Binance token lost nearly 5%, while OKEx’s native token lost 6%.

Cryptocurrency markets have been in free fall since last week, after that FTX, the third largest exchange in the crypto space, declared bankruptcy and suspended customer withdrawals. Attention is now shifting to other entities exposed to the exchange, such as BlockFi, which recently suspended withdrawals due to its heavy exposure.

Help is needed for crypto and the market, and Binance seems willing to address the issues. All that remains is to wait to see if they can pull it off or if they will back down as they did with their refusal to buy FTX.