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25 Nov 2022

Binance clarifies initial $1 billion recovery fund deposit came from own assets

Binance clarifies initial $1 billion recovery fund deposit came from own assets

Crypto exchange Binance clarified that an initial $1 billion deposit to its crypto industry recovery fund came from its own assets after details of the transferring wallet raised questions among some commentators on Twitter. 

On-chain transactions show the funds came from one of Binance's cold wallets for BUSD, the exchange's dollar-pegged stablecoin. 

This wallet was recently listed in Binance's proof of funds documentation, which shows all the cold and hot wallets the exchange owns as part of a transparency push following this month's collapse of rival crypto exchange FTX.

Some in the crypto community had raised concerns that Binance could be using customer funds as the wallet is listed as part of  its proof of funds.

"These are not customer funds. These are Binance assets that have been set aside," a spokesperson for the exchange said in emailed comments. 

Binance launched the recovery fund on Thursday with 1 billion BUSD  in initial capital, which can be verified at the following address. A number of big names in the crypto industry have signed on to contribute including GSR, Jump Crypto and Polygon Ventures. The addresses of other participants will be available in the next week. 

The fund was announced last week to help mitigate the fallout stemming from FTX's collapse. It's expected to last for around six months and has already received over 150 applications. Binance has stressed that it's not an investment fund.

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