The world’s largest crypto exchange has committed $1 billion worth of Binance U.S. Dollar (BUSD) to its crypto industry recovery fund.
The crypto exchange said the initial billion-dollar commitment could be ramped up to $2 billion in the near future if the need should arise.
Binance’s recovery initiative has gained support from high profile companies and investors in the space, including Jump Crypto, Aptos Labs, Animoca Brands and Polygon Ventures. These investors have reportedly agreed to participate with an initial investment of $50 million each.
Binance CEO Changpeng Zhao first proposed the recovery fund on Nov. 14 as a way to combat the “cascading negative effects of FTX.”
After FTX’s unexpected collapse, several leading crypto companies, like BlockFi and Genesis, suspended withdrawals after finding themselves short on liquidity as depositors rushed to move funds off centralized platforms. With industry heavyweights taking a hit, it is likely that several smaller industry players will also find themselves affected by the FTX contagion.
The company invited “the most promising and highest quality” crypto projects experiencing a liquidity crunch to reach out to Binance for financial support from the fund.
Binance will determine which projects qualify by evaluating if they have a scope for long-term value creation, a viable business model and a “laser focus” on risk management.
“We have already received around 150 applications from companies seeking support under the IRI [Industry Recovery Initiative]. Each co-investor within the IRI will have the opportunity to review potential deals and decide for themselves whether they wish to participate,” said Binance.