Crypto Exchange Unveils Industry Recovery Initiative (IR), Key Players Join
On Thursday, November 24, crypto exchange Binance unveiled its Industry Recovery Initiative (IRI). Ever since the collapse of crypto exchange FTX, Binance chief Changpeng Zhao has vowed to setup a recovery fund.
The basic aim of this fund will be help cash-strapped startups which are fundamentally good business, and protect them by offering enough liquidity during such times of distress or any FTX-like event in the future.
“We’re going with a loose approach where different industry players will contribute as they wish,” said CZ during an interview with Bloomberg on Thursday. Later on the day, the crypto exchange also had a press release wherein it noted that Binance has already pledged $1 billion in the recovery fund to a public address.
Additionally, a few more crypto participants have also pledged additional amount. For e.g. Jump Crypto, Polygon Ventures, Aptos Labs, Animoca Brands, GSR, Kronos and Brooker Group made a combined initial pledge of $50 million.
The press release from Binance reads: “As a leading player in crypto, we understand that we have a responsibility to lead the charge when it comes to protecting consumers and rebuilding the industry. That is why we have established the Industry Recovery Initiative (IRI), a new co-investment opportunity for organizations eager to support the future of Web3”.
“Initially, Binance will commit USD 1 billion to IRI-themed investment opportunities with an intent to ramp up that amount to USD 2 billion in the near future if the need arises,” it added.
Binance said that the IRI isn’t an investment fund but rather a “co-investment opportunity for organizations eager to support the future of Web3”. Each participant will have to set aside a committed capital, including stablecoins and other tokens. To ensure transparency, this capital should be put in public address.
Furthermore, each participant can review the investment opportunities and make investment decisions independently of each other.
Additionally, Binance also stated that they are exploring further deal structures under the broader theme of IRI which will also allow traditional financial institutions to participate.
The crypto exchange also said that it has already received 150 applications for companies seeking support under the IRI. “The mandate of this new effort is to support the most promising and highest quality companies and projects built by the best technologists and entrepreneurs that, through no fault of their own, are facing significant, short term, financial difficulties. What makes this initiative unique is the collaborative approach to restoring confidence in Web3,” they added.