Binance Proposes Fund To Save Crypto From Future Failures

NEW YORK (AP) — Crypto exchange giant Binance is proposing to create a rescue fund to save healthy crypto companies from bankruptcy. FTX, the world’s third largest cryptocurrency exchange, crashed last week.

Binance Founder and CEO Changpeng Zhao Post to Twitter On Monday, his company announced it would set up an “industry recovery fund to support otherwise strong but liquidity-stressed projects.”

Zhao did not provide details about the fund’s size or scope or how the fund will be distributed.

The entire crypto world is reeling from the bankruptcy of FTX. What is the cryptocurrency equivalent of a bank crackdown?. is up to date Crypto company failures of the yearas the prices of Bitcoin, Ethereum, and other cryptocurrencies fell.

While it’s still too early to determine the far-reaching impact of FTX’s failure, there are other companies facing withdrawal requests that strain the system. Both BlockFi and say they are facing high withdrawal requests after the FTX failure.

Since cryptocurrencies have no government backing, there is no equivalent of deposit insurance or government backstops. What Zhao is proposing might be something akin to a deposit insurance or a central bank for cryptocurrencies.