Summary

• Binance announced a $1 billion Industry Recovery Initiative (IRI) in November 2022 to help crypto projects facing liquidity crises.
• As of October 10, 2023, Binance has only allocated $15 million in BUSD stablecoins, with the remaining $985 million repatriated to Binance's corporate treasury.
• Out of the 18 participants in the IRI, only DWF Labs and Aptos Labs have deployed funds so far, with DWF Labs deploying $2 million and Aptos Labs investing "more than" the $5 million it committed.
• The future of the IRI's involvement in supporting crypto projects remains uncertain, however, its Google Docs applicant form continues to remain open.

Questioning the Initiative

In the aftermath of the FTX collapse that threw the crypto industry in disarray, Binance turned savior, unveiling an ambitious Industry Recovery Initiative (IRI). The IRI aimed to “reduce further cascading negative effects of FTX” and provide essential support to the crypto industry during turbulent times. However, a recent Bloomberg report has raised questions about its effectiveness.

Binance moved $985 million back to its treasury

The IRI was officially announced in November 2022, with Binance pledging a staggering $1 billion in its BUSD (Binance USD) stablecoins to kickstart the initiative. However, as of October 10, 2023, it appears that the IRI may not have lived up to the initial hype. Binance had allocated $15 million in BUSD stablecoins, leaving a substantial $985 million untouched. Bloomberg reported that the remaining funds were repatriated to Binance's corporate treasury, signaling a shift in strategy amid growing regulatory concerns surrounding stablecoins.

Having disbursed less than $30 million to date, the IRI sought to provide support to crypto projects facing liquidity crises, attracting participation from 18 different entities, including Jump Crypto, DWP Labs, Animoca Brands, Aptos Labs, GSR, Kronos Research, Booker Group, and Polygon Labs, who together added an extra $100 million to the initiative. 

Binance claimed in February that IRI have funded 14 projects, with another 57 in due diligence. However, Binance did not disclose the funded projects, with the exception of South Korean crypto exchange GOPAX.  

Only DWF Labs and Aptos delivered so far…

Notable among the IRI participants, DWF Labs reportedly deployed only $2 million out of its $15 million IRI commitment. Aptos Labs, on the other hand invested "more than" the $5 million it committed. The remaining participants either failed to deploy any funds or could not be identified, as reported by Bloomberg.

"We didn't identify many projects who would meet our criteria, and this is the same for the other investors," said Dana Hou, Binance Labs' business strategy lead, in a statement to Bloomberg.

According a recent Messari report on the State of Crypto Fundraising Q3, the third quarter of 2023 witnessed a significant downturn, marking new lows in both total funding amounts and deal counts, reminiscent of the levels last observed in Q4 of 2020.

The future of the Initial Recovery Initiative's involvement in supporting crypto projects remains uncertain, however, its Google Docs applicant form continues to remain open.