Binance will contribute $1 billion to a cryptocurrency recovery project

Binance, a cryptocurrency exchange, announced on Thursday that it would devote $1 billion to creating an industry recovery initiative (IRI) to fund businesses in the digital assets industry as per Reuters.

The action is being taken while FTX, which is looking for Chapter 11 bankruptcy protection in the United States, collapses and the cryptocurrency market is on edge.

Concerns about the industry’s ability to continue attracting investments from major venture capital and private equity firms have also been stoked by the collapse of one of the largest cryptocurrency exchanges in the world.

Depending on demand, Binance said it might soon increase its committed amount to $2 billion.

The cryptocurrency exchange continued, “We believe this effort will run roughly six months and will be flexible on the investment structure — token, fiat, equity, convertible instruments, debt, credit lines, etc.

Following the demise of rival FTX, Zhao claimed last week at a conference in Abu Dhabi that there was much interest from industry leaders in a recovery fund his company planned to form to assist cryptocurrency ventures facing a liquidity crunch.

Without providing the fund’s actual cost, he said it would “prevent further cascading detrimental consequences of FTX.”

Many cryptocurrency companies have been estimating their exposure to the troubled exchange in the millions as they prepare for the consequences from the FTX collapse.