Binance founder and CEO Changpeng Zhao has unveiled a $1 billion initiative to help the crypto industry recover from the fall of the FTX collapse. File Photo by Miguel Lopez/EPA-EFE
Nov. 24 (UPI) -- Cryptocurrency exchange Binance said Thursday is leading an effort to prop up the industry after competitor FTX tanked earlier this month.
In a blog post, Binance unveiled the company's industry recovery initiative, which will devote $1 billion to support "promising" companies and projects that are facing "significant, short term, financial difficulties."
Binance recruited investors Jump Crypto, Polygon Ventures, Aptos Labs, Animoca Brands, GSR, Kronos and Brooker Group, which together committed $50 million to the plan.
The exchange says it has received about 150 applications from crypto companies looking for assistance.
"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," the blog post reads. "Aside from funding support, we plan to provide founders and projects with comprehensive support -- from formation, technical execution, fundraising, and more -- so that they can emerge and grow stronger from the crypto winter."
The company said it intends to step up its recovery fund to $2 billion at some point in the future if necessary.
Binance had a non-binding deal in place to acquire FTX, a competing exchange formerly owned by crypto mogul Sam Bankman-Fried. The deal was pulled after Binance uncovered ""mishandled customer funds and alleged U.S. agency investigations."
Bankman-Fried stepped down as CEO of FTX and the company entered Chapter 11 bankruptcy proceedings.
The House Financial Services Committee plans to investigate FTX's collapse starting in December.
FTX Group allegedly owes about $3.1 billion to its 50 largest creditors. It also faced an $8 billion shortfall and lacked the liquid assets to complete a buyout from Binance. The exchange temporarily closed down the ability to withdraw before reopening the function after several days.
Binance CEO Changpeng Zhao said he did not rejoice in the collapse of one of his competitors. Instead, he told his employees in a a message that the fall of the exchange was bad for the industry.