Binanceâs founder and CEO said the firmâs crypto rescue fund will initially have $1 billion to dole out as it steps into the role of industry white knight.
In an interview with Bloomberg, Changpeng "CZ" Zhao said the fund would have a âlooseâ structure and be publicly visible on the blockchain, with other industry players also able to contribute.
âThe industry needs saving now, not in 2023,â he said.
A blog post outlining the launch also suggested that the fund could grow to as much as $2 billion "if the need arises." The team will first assess how far the $1 billion goes before potentially injecting more cash, CZ said. The post also included the public address for these funds.
âRoughly, weâre thinking of setting up $1 billion first, and if thatâs not enough weâll allocate more. If after six months thereâs unused funds and thereâs not that many projectsâhopefully the industry will have recovered by thenâwe can withdraw it back.â
The exchange exec first announced the launch of an "industry recovery fund" on November 14 to prop up firms that "are otherwise strong but in a liquidity crisis" amid the FTX fallout. At that time, BankToTheFuture CEO Simon Dixon and the founder of Tron Justin Sun announced that they, too, would contribute to the fund. It's unclear if they have indeed contributed, however.Â
For now, these names have not contributed to the fund. Binance said that Jump Crypto, Polygon Ventures, and Aptos Labs were a few of the projects who had contributed an aggregate of roughly $50 million.
Binance eyes FTXâs distressed assets
CZ also confirmed in the Bloomberg interview that some of the ailing crypto projects bought up by now-bankrupt exchange FTX may be on the fundâs shopping list, but did not say which ones.
âWe definitely want to look at those assets,â he said. âThey invested in a number of different projects, some of them are OK, some of them are bad, but I think there are a number of assets that may be salvageable. Weâll look through that when they become available.â
Sam Bankman-Friedâs companies, including both FTX and hedge fund Alameda Research, went on an acquisition and bailout streak earlier this year in the wake of Terraâs collapse and the subsequent pain for the crypto industry.
Crypto lender BlockFi accepted credit from FTX.US over the summer and is now considering launching its own bankruptcy proceedings due to the exposure. It has already held talks with Binance about possible help.
Meanwhile, Voyager Digital, which had accepted a $1.4 billion bid from FTX to acquire its distressed assets in September, is now on the hunt for another buyer.
As recently as September, SBF had claimed that FTX had $1 billion ready to spend on more buyouts. At one point, rumors were even circulating that he was mulling a takeover of the publicly-listed trading app Robinhood.
SBFâs fall from grace now leaves CZ to step into the role of industry savior, even though the Binance CEO had previously indirectly criticized FTXâs tactics in a June blog post.
"Donât perpetuate bad companies,â he wrote at the time. âLet them fail."