- Binance has launched a $1 billion fund to support Binance Smart Chain and other sectors.
- The news follows a string of controversies for the exchange over recent months.
Crypto exchange Binance has launched a $1 billion growth fund to spur on the adoption of blockchain technology, as well as to support the Binance Smart Chain blockchain itself.
“With the $1 billion initiative, our focus will be widened to building cross-chain and multi-chain infrastructures integrated with different types of blockchains,” Gwendolyn Regina, investment director of the Binance Smart Chain Accelerator Fund reportedly said in a statement.
Approximately half of the funds will go to blockchain services, as well as other, more niche areas of the crypto world such as gaming and virtual reality.
In addition, about $300 million will reportedly go to a builder program, and another $100 million will go to talent development and liquidity incentives. Liquidity incentives in this context suggest the fund will provide additional bonuses to crypto platforms. Increased yields for a limited time on decentralized finance (DeFi) platforms has been one example of this.
News of the fund comes amid a long and drawn-out period of regulatory controversy for Binance.
Binance’s recent, controversial months
It’s been a difficult few months for Binance, as the exchange has raised the ire of financial services regulators around the world.
Regulators in the UK, Italy, Malaysia, the Cayman Islands, Singapore, Holland, South Africa, and Japan have all addressed the exchange’s apparent regulatory shortcomings.
In Holland and Japan, the Dutch Central Bank and the Financial Services Agency issued consumer warnings about Binance. In Italy and the Cayman Islands, regulators said Binance is not licensed to do business in their respective countries.
The Malaysia Securities Commission went as far as to take enforcement action against Binance for allegedly operating illegally in the country.
Singapore—where CZ lives—said Binance is not currently licensed, but recently told Decrypt an application was ongoing. Last month, the Monetary Authority of Singapore placed Binance on an Investor Alert List.
In the UK, the Financial Conduct Authority also issued a consumer warning against Binance, before doubling down and saying Binance Markets Limited—a UK Binance entity—was incapable of being regulated after the company failed to provide basic information to the regulator.
One of the biggest questions surrounding Binance has been its self-proclaimed and apparent lack of a headquarters, something which Binance CEO Changpeng Zhao has previously insisted on.
However, last month and off the back of these regulatory controversies, Zhao admitted a headquarters would be a necessity down the road.
“We have come to realize that we need a centralized entity to work well with regulators,” Zhao said last month.