Changpeng Zhao first announced the fund following FTX filing for bankruptcy, saying it would be aimed at helping projects with liquidity issues but was not for “liars or frauds.”
Changpeng “CZ” Zhao, CEO of crypto exchange Binance, has denied a report claiming he met with investors in Abu Dhabi in an effort to raise cash for the company’s crypto recovery fund.
According to a Nov. 22 report from Bloomberg, CZ and others affiliated with Binance discussed raising cash for its proposed fund, aimed at helping projects with potential liquidity issues. Zhao and the Binance team reportedly met with potential backers associated with United Arab Emirates National Security Adviser Sheikh Tahnoon bin Zayed, while a Binance spokesperson said the meetings were “focused on general global regulatory matters.” CZ pushed back against the report on Twitter, saying simply that it was “false.”
The Binance CEO first announced the fund on Nov. 14 following FTX’s “liquidity crunch” and bankruptcy filing. It’s unclear how large the crypto exchange intended the fund to be. FTX’s bankruptcy filings suggested the firm owed more than $3 billion, while it had slightly more than $1.2 billion in cash as of Nov. 20. However, CZ added on Twitter that the fund was never intended for “liars or frauds.”
To reduce further cascading negative effects of FTX, Binance is forming an industry recovery fund, to help projects who are otherwise strong, but in a liquidity crisis. More details to come soon. In the meantime, please contact Binance Labs if you think you qualify. 1/2
— CZ Binance (@cz_binance) November 14, 2022
Binance and CZ became entangled in the FTX debacle after announcing that the exchange planned to liquidate its supply of FTX Token (FTT) and discussing a possible bailout at the request of then CEO Sam Bankman-Fried. Binance pulled out of the potential deal less than 48 hours later, FTX filed for bankruptcy, and Bankman-Fried resigned.
“If we can’t help him, there’s probably nobody else that would,” said CZ on Nov. 17 in reference to a call with Bankman-Fried regarding FTX. “Probably a bunch of people passed on the deal before us.”
Related: CZ explains why it's so important to be building during the bear market
Based in Dubai since October 2021, CZ has been steadily pushing for adoption in the Middle East. In September, Dubai’s Virtual Asset Regulatory Authority gave the green light for Binance to offer virtual asset services to qualified retail and institutional investors. Abu Dhabi’s Global Market and Financial Services Regulatory Authority granted Binance similar approval to offer crypto services in November.
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