Binance’s Industry Recovery Initiative Falls Short of Expectations
A new report suggests that Binance’s Industry Recovery Initiative (IRI), a project aimed at supporting the cryptocurrency industry following the collapse of FTX, may not have been as effective as intended. According to Bloomberg, Binance spent $15 million of its total $1 billion commitment in BUSD stablecoins on the IRI. However, the remaining $985 million was returned to Binance’s corporate treasury for other investments.
By February 2023, the IRI had collected an additional $100 million in contributions from 18 organizations, including Animoca Brands and Polygon Ventures. Binance claimed that 14 projects were funded by the IRI within three months of its launch, but did not disclose the names of the companies receiving funding. Wallet data collected by Bloomberg suggests that less than $30 million has been invested by the IRI since its inception.
It is unclear whether the IRI is still actively supporting cryptocurrency projects, as its Google Docs applicant form remains active. The underperformance of the IRI comes at a time when the cryptocurrency industry is struggling for funding, with cryptocurrency-related venture funding decreasing by up to 70% in Q3 2023 compared to Q1 2021.
Hot Take: Challenges in Supporting Crypto Projects Amid Funding Shortages
The shortcomings of Binance’s Industry Recovery Initiative highlight the challenges faced by the cryptocurrency industry in securing adequate funding. While there were high capital commitments made to support projects affected by the FTX collapse, the actual contributions fell short of expectations. This discrepancy raises concerns about the sustainability and effectiveness of such initiatives.
With cryptocurrency-related venture funding experiencing a significant decline, it becomes crucial for industry players to reassess their strategies for supporting crypto projects. Finding alternative sources of funding and implementing more transparent and accountable investment frameworks could help address the funding shortage and ensure the long-term growth and stability of the cryptocurrency industry.
By
By
By
By
By