Binance-Led IRI Underperforms: Crypto Industry Recovery Effort Falls Short on Actual Contributions
Summary:
The Industry Recovery Initiative (IRI) led by Binance seems to have under-performed, according to a recent study. Binance used a mere $15 million out of the $1 billion BUSD it committed, returning the remaining sum to its treasury for investment purposes. As of February 2023, 18 organizations, including Animoca Brands, Aptos Labs, Jump Crypto, and Polygon Ventures, contributed an additional $100 million to the IRI. So far, less than $30 million has been invested since its inception. The IRI's actual contributions fall short, especially as the crypto industry witnesses a decrease in funding.
The Industry Recovery Initiative (IRI), pioneered by Binance and intended for boosting the crypto industry following FTX's downfall, might not have achieved as much success as anticipated, according to a recently released study. The announcement of the IRI by Binance in November 2022, saw the firm inject $15 million in its BUSD (BUSD) stablecoins from a total commitment of $1 billion in BUSD, as stated in a Bloomberg report dated Oct. 10. The remaining $985 million in dedicated BUSD was transferred back to Binance's corporate treasury, intended for various investment purposes. Binance, due to growing regulations around stablecoins, transitioned these funds from BUSD into cryptocurrencies like Bitcoin (BTC) in March.
Aside from Binance, there were 18 organizations, including Animoca Brands, Aptos Labs, Jump Crypto, Polygon Ventures among others, that added to the IRI, shooting the contributions up to an extra $100 million by the end of February 2023. The IRI, in three months following its introduction, funded 14 projects as reported by Binance, however, decided against revealing the names of the beneficiaries. Gopax, a South Korean crypto exchange which was acquired by the exchange marks Binance's only publicly recognized expense from the firm's $1 billion IRI commitment.
According to Bloomberg's compiled wallet data, since its establishment the previous year, the IRI has invested less than $30 million. Out of the nine participants named, only DWF Labs and Binance-backed Aptos used a portion of the pledged funds.
It's yet to be clear if the IRI will continue to extend support to crypto-related ventures, even though its Google Docs application form still accepts responses. Binance chose not to immediately respond to a request for comments by Cointelegraph.
While the crypto industry scrambles for funding, a discrepancy arises between the IRI’s promised capital and its actual contributions. The volume of crypto-related venture funding per quarter has seen a falloff of up to 70% since Q3 2022. On Oct. 5, blockchain analysis firm, Messari showed in a report that crypto VC volumes in Q3 2023 was around a meager $2 billion, a downfall compared to the record high of $17 billion in Q1 2021.
Published At
10/10/2023 9:55:09 AM
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