The Crypto Industry has started facing more criticism than ever before since the bankruptcy of FTX. Binance has, in turn, called for more regulation and vowed to create a crypto industry recovery fund.
CEO of Binance, Changpeng Zhao, was speaking at the G20 leaders’ summit in Bali, Thailand. He said, “We’re in a new industry. We’ve seen in the past week things go crazy in the industry. We do need some regulations. We do need to do this properly. We do need to do this in a stable way.”
Who Benefits From The Crypto Industry Recovery Fund?
CEO of Binance, Changpeng Zhao, has taken the initiative to support crypto projects facing a liquidity crisis. The exact size of the planned fund has not been disclosed, but the goal of the crypto industry recovery fund is clear.
Zhao hopes it will “reduce further cascading negative effects of FTX.” FTX was Binance’s rival cryptocurrency exchange. Binance had offered FTX a buyout deal to rescue the exchange from collapsing.
Binance backed out after due diligence. Binance had liquidated its FTX holdings early in November, and as clients withdrew around $6 billion in 72 hours, FTX had no chance of recovery. Zhao also mentioned that Binance never shorted FTX.
The aftereffects of FTX’s bankruptcy are affecting the entire industry. With this fund, Zhao hopes to help projects facing a liquidity crisis but otherwise strong.
Calls For Regulation
The CEO of FTX, Simon Bankman-Fried, had been incredibly earnest and optimistic with regard to his cryptocurrency exchange. He once stated, “There are irresponsible actors in the digital-asset industry, and those actors attract the headlines, but FTX is not one of them and has built a resilient, risk-reducing platform as a competitive advantage.”
This was one year before he admitted to grossly messing things up and stepping down as CEO. The company filed for Chapter 11 bankruptcy protection in the United States and closed operations.
Regulators and lawmakers in Capitol Hill called for investigation and regulations to be enforced. White House Press Secretary Karine Jean-Pierre told reporters, “The administration has consistently maintained that, without proper oversight of cryptocurrencies, they risk harming everyday Americans.”
Zhao also called for more stable and clear industry regulations to curb participants from “cutting corners.” He also highlighted the role of the industry in protecting customers. Zhao said, “I think the industry collectively has a role to protect consumers, to protect everybody. So it’s not just regulators. Regulators have a role but it’s not 100% their responsibility.”