Cryptocurrency exchange Binance has announced that the first $1 billion invested in the crypto industry recovery fund came from its own assets, after details about the transferred wallet raised questions among some observers on Twitter.
On-chain transactions indicate that the funds came from one of Binance’s cold wallets, which it uses for its dollar-pegged stablecoin, BUSD.
Binance Spokesperson Denies Allegation, Saying The Funds Used Are The Company’s Own Assets
This wallet was recently listed on Binance’s proof-of-fund documents showing all cold and hot wallets owned by the exchange as part of its transparency effort following the collapse of rival crypto exchange FTX this month.
Some in the crypto community have expressed concerns that Binance may be using client funds as the wallet is listed as part of the proof of funds.
“These are not client funds,” a spokesperson for the cryptocurrency exchange told Block. These are Binance assets that we have set aside.”
Binance on Thursday launched a recovery fund with 1 billion BUSD start-up capital. A number of big names in the crypto industry have also announced that they will contribute to the fund, including GSR, Jump Crypto, and Polygon Ventures. Addresses of other participants will be announced within the next week.
The funding was announced last week to help mitigate the effects from FTX’s collapse. More than 150 applications have already been made for the fund, which is expected to take about six months. The company stressed that this is not a mutual fund.
However, CZ recently announced that the amount of assets in the opened fund has been increased to $2 billion.
*Not investment advice.
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