Binance

Binance.US faces class-action lawsuit over LUNA and UST sale

The lawsuit could be the first of many for U.S.-listed crypto exchanges that offered LUNA or UST to customers.

Binance.US, the sister company of global cryptocurrency exchange Binance, is facing a class-action lawsuit from investors for the sale of LUNA and TerraUSD (UST).

A group of investors filed a class-action lawsuit in the Northern District of California on Monday, alleging that Binance sold unregistered securities in the form of LUNA and UST to investors and mislead them into buying them.

The lawsuit was filed by law firms Roche Freedman and Dontzin Nagy & Fleissig on behalf of several investors who lost their money during the recent LUNA and UST collapse.

The lawsuit alleged that Binance.US is not registered as a broker-dealer in the United States and thus clearly violates U.S. securities laws. The plaintiffs in the case accused the crypto exchange of knowingly promoting a flawed project in which the parent company had invested earlier.

The lawsuit filing pointed out that the crypto exchange not only supported and promoted the security token, but its parent company also listed the second version of LUNA 2.0 after the failure of the first.

The lawsuit also accused the crypto exchange of false advertising, pointing toward its claims of UST being fiat-backed, which was redacted after the collapse.

An excerpt from the lawsuit read:

“Binance U.S.’s failure to comply with the securities laws, and its false advertisements of UST, have led to disastrous consequences for Binance U.S.’s customers.”

The plaintiffs in the case have demanded a trial by jury for all charges that are deemed trialable. Binance didn’t respond to Cointelegraph’s request for comments at press time.

Kyle Roche, founder of Roche Freedman, had earlier requested LUNA investors to contact the firm in case they bought LUNA on any of the leading crypto exchanges in the United States. Thus, the lawsuit against Binance could be the first of many.

If you purchased $LUNA or $UST on either @coinbase @krakenfx @binance or @Gemini, please reach out to TerraRecovery@rochefreedman.com . My firm is coordinating an effort to help those who lost funds from the recent collapse of #terra and #luna.

— Kyle Roche (@KyleWRoche) May 13, 2022

While investors in South Korea filed a lawsuit against the founders of the Terra project the same week it tanked, the latest case against Binance.US is the first in America. Looking at the earlier tweet of the law firm involved in the lawsuit, other U.S.-registered crypto exchanges might face similar lawsuits in the near future.

Binance’s legal trouble continues to mount in the U.S. as the lawsuit comes at a time when the Securities and Exchange Commission is already investigating its BNB initial coin offering from 2017.

Binance ends support for anonymous Litecoin transactions

Litecoin’s MWEB upgrade, which makes transactions confidential, comes at a time when the majority of the crypto exchanges are implementing strict KYC and AML guidelines.

Crypto exchange Binance announced they are ending support for Litecoin (LTC) transactions sent through the latest MimbleWimble (MWEB) upgrade.

Binance warned that any transaction sent through the MWEB function would be lost since the crypto exchange can’t verify the sender’s address. The crypto exchange didn’t respond to Cointelegraph’s request for comments at the time of publishing.

The announcement comes just days after major South Korean crypto exchanges delisted LTC due to the latest upgrade, which makes transaction information confidential. The delisting came just weeks after five crypto exchanges issued warnings similar to Binance. However, the delisting didn’t come as a surprise as S.Korea is known for its strict privacy laws, which prohibit anonymous transactions on crypto exchanges.

The MWEB upgrade on LTC is one of the critical updates that went live earlier this year, nearly two and half years after it was first proposed. The upgrade added several privacy features and made the LTC blockchain more scalable.

Gate.io, another popular crypto trading platform, also ended support for MWEB Litecoin transactions, claiming anonymous transactions are not supported on the platform.

The decision to end support for the MWEB function also comes at a time when the leading crypto exchange has been marred in controversies. Binance was recently accused of facilitating $2.5 billion worth of illicit transactions by Reuters.

Chagpeng Zhao (CZ), the CEO of Binance refuted all such allegations, pointing to the data released by blockchain analytics firm Chainalysis.

The Reuters article yesterday is a huge waste of time and resources. This is the last I'll say on it, and the last our team will interact with the writer.

The author continues to wear it as a badge of honor on Twitter when his fiction pieces get fact-checked after he publishes.

— CZ Binance (@cz_binance) June 7, 2022

The United States Securities and Exchange Commission also opened a security violation investigation regarding Binance’s BNB ICO sale in 2017.

The privacy feature that was seen as an important upgrade has turned out to be a bane for one of the oldest cryptocurrencies. The MWEB upgrade comes at a time when thregulatory oversight is at its highest and privacy features have become the primary target of regulators around the globe.

This key Ethereum price metric shows ETH traders aren’t as bearish as they appear

Traders keep saying ETH price will collapse below $1,600 soon, but a key trading metric shows most are unwilling to place bearish bets below $1,900.

Ether (ETH) is down 25% in just a month and even the recent upgrade to a proof-of-stake (PoS) consensus on the Ropsten testnet failed to move the altcoin’s price.

The merge is meant to address energy-use issues and open a path for higher transaction output, but the actual full transition for the Ethereum network is not expected until later in the year. Ethereum developer Parithosh Jayanthi also noted that some bugs on the PoS implementation emerged, but those should be fixed over the coming weeks.

Luckily for Ethereum, two of its top competitors recently faced challenges of their own. The Solana (SOL) network faced the fifth outage in 2022 after no new blocks were produced for four hours on June 1. Every decentralized application was halted until the validators were able to address the problem and re-sync the network.

More recently, Binance’s native BNB token dropped 7% on June 7 after news that the United States Securities and Exchange Commission announced that it had opened an investigation into the initial coin offer (ICO) from 2017. According to Bloomberg, at least one U.S. resident claimed to have taken part in the ICO, which could be crucial for an SEC case.

Regulatory uncertainty could be partially responsible for Ether’s sharp correction. On June 6, Hong Kong’s Securities and Futures Commission (SFC) released a note warning about the investment risks of nonfungible tokens . The regulatory agency highlighted the sectors’ opaque pricing, illiquid markets and frauds.

Options traders are still extremely risk-averse

Traders should look at Ether’s derivatives markets data to understand how larger-sized traders are positioned. The 25% delta skew is a telling sign whenever whales and arbitrage desks overcharge for upside or downside protection.

If those traders fear an Ether price crash, the skew indicator will move above 10%. On the other hand, generalized excitement reflects a negative 10% skew. That is precisely why the metric is known as the pro traders’ fear and greed metric.

*Ether 30-day options 25% delta skew: Source: Laevitas.ch*

The skew indicator has been above 10% since May 22, and it recently peaked at 20% on June 3. Those levels signal extreme fear from options traders, and despite the modest improvement, the current 17% delta skew shows whales and arbitrage desks unwilling to take downside risk.

Long-to-short data is showing a few positives

The top traders’ long-to-short net ratio excludes externalities that might have solely impacted the options markets. By analyzing these top clients’ positions on the spot, perpetual and quarterly futures contracts, one can better understand whether professional traders are leaning bullish or bearish.

There are occasional methodological discrepancies between different exchanges, so viewers should monitor changes instead of absolute figures.

*Exchanges’ top traders Ether long-to-short ratio. Source: Coinglass*

Even though Ether has struggled to sustain $1,800 as a support, professional traders did not change their positions between June 5 and 9, according to the long-to-short indicator.

Binance displayed a modest decrease in its long-to-short ratio, as the indicator moved from 0.99 to the current 0.96 in four days. Thus, those traders slightly net increased their bearish bets.

Huobi data shows a similar pattern and the indicator moved from 1.02 to 0.98 on June 9, which was a small change favoring shorts. At OKX exchange, the metric oscillated drastically within the period but finished nearly unchanged at 1.35.

Mixed derivatives data provides hope for bulls

Overall, there hasn’t been a significant change in whales and market makers’ leverage positions despite Ether’s failure to break the $1,900 resistance on June 6.

From one side, options traders fear that a deeper Ether price correction is likely in the making, but at the same time, futures market players have no conviction to increase bearish bets.

This reading is likely a “glass half full” scenario as the top traders’ unwillingness to short below $1,900 can potentially create a support level.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

Bitcoin bears have plenty of reasons to hold BTC price below $32,000

Regulatory pressure and macroeconomic uncertainty continue to pin traders’ sentiment and BTC price under $32,000.

Since May 10, the Bitcoin (BTC) chart shows a relatively tight range of price movement and the cryptocurrency has failed to break the $32,000 resistance on multiple occasions.

*BTC-USD 12-hour price at Coinbase. Source: TradingView*

The choppy trading partially reflects the uncertainty of the stock market as the S&P 500 Index ranged from 3,900 to 4,180 in the same period. On one side, there has been economic growth in the Eurozone where the gross domestic product grew 5.1% year over year. On the other, inflation continues to soar, reaching 9% in the United Kingdom.

Further adding to Bitcoin’s volatility was the digital assets regulatory framework proposal introduced to the U.S. Senate on June 7. The 69-page bipartisan bill is supported by Senator Cynthia Lummis of Wyoming and Senator Kirsten Gillibrand of New York and it addresses the CFTC’s authority over applicable digital asset spot markets.

On June 3, South Korea’s Financial Supervisory Service (FSS) began an inquiry with 157 payment gateway services that work with digital assets. Previously, on May 24, South Korean officials opened an investigation against Do Kwon, the primary figure in the Terra incident.

The U.S. Securities and Exchange Commission (SEC) also broke out an investigation against Binance Holdings on June 6. Binance is the world’s largest crypto exchange in volume terms and the SEC is evaluating whether the BNB token initial coin offering violated securities rules.

On June 6, IRA Financial Trust, a platform providing self-directed digital asset retirement and pension accounts, filed a lawsuit against Gemini cryptocurrency exchange and claimed that a Feb. 8 breach led to a $36 million loss in crypto assets from customer accounts under Gemini’s custody.

Let’s look at Bitcoin’s futures data to understand how professional traders are positioned, including whales and market makers.

Derivatives metrics reflect investors’ bearish expectations

Traders should analyze Bitcoin futures market data to understand how professional traders are positioned. The quarterly contracts are experienced traders’ preferred instrument to avoid the perpetual futures’ fluctuating funding rate.

The basis indicator measures the difference between longer-term futures contracts and the current spot market levels. The Bitcoin futures annualized premium should run between 5% to 10% to compensate traders for “locking in” the money for two to three months until the contract expiry.

*Bitcoin 3-month futures annualized premium. Source: Laevitas*

Bitcoin’s futures premium has been below 4% since April 12, a reading typical of bearish markets. Even more concerning is that the last time these professional traders were bullish was over six months ago when the metric surpassed the 10% threshold.

To exclude externalities specific to the futures instrument, traders must also analyze the Bitcoin options markets. The 25% delta skew is a telling sign for when Bitcoin market makers and arbitrage desks are overcharging for upside or downside protection.

During bullish markets, options investors give higher odds for a price pump, causing the skew indicator to move below negative 12%. On the other hand, a bear market’s generalized panic induces a positive 12% or higher skew.

*Bitcoin 30-day options 25% delta skew: Source: Laevitas*

The 30-day delta skew has ranged from 12.5% to 23% between June 1 and 7, which signals options traders are pricing higher odds of a bearish movement. Still, it shows a moderate sentiment improvement from the previous couple of weeks.

Cryptocurrency regulation and weak economic numbers are clearly weighing on investor sentiment and derivatives data shows professional Bitcoin traders avoiding leveraged long positions, plus they are reluctant to take downside-risk.

At the moment, it’s clear that bears are comfortable with setting $32,000 as a resistance level and repeat drops to the $28,200 level are likely to continue.

Bad day for Binance with SEC investigation and Reuters exposé

The SEC is reportedly suspicious that the world’s biggest crypto exchange sold unlicensed securities in its ICO, and the news agency tallied up some old cases.

The United States Securities and Exchange Commission is investigating whether Binance Holdings broke securities rules when it launched its BNB token in an initial coin offering (ICO) five years ago, Bloomberg reported on Monday.

Binance is the world’s largest crypto exchange, and BNB is the fifth-largest cryptocurrency.

The BNB ICO took place in July 2017 on several platforms during the height of the so-called ICO boom, and the Binance exchange opened just days afterward. According to Bloomberg, citing unnamed people familiar with the matter, at least one U.S. resident claimed to have taken part in the ICO, which could be a crucial fact for an SEC case, if the agency chose to pursue one. The SEC has claimed most cryptocurrencies are securities and brought cases against a number of ICO projects.

Binance founder and CEO Changpeng Zhao, often known as “CZ,” said in a 2020 blog post that the wording of the BNB white paper was changed in January 2019 because “the potential for being misunderstood as a security is higher in certain regions.” Binance’s American arm, Binance.US, was created later that year.

Also on May 6, Reuters published a lengthy special report alleging that Binance processed at least $2.35 billion of transactions from hacks, investment frauds and narcotics sales between 2017 and 2021, and had weak Know Your Customer (KYC) and Anti-Money Laundering (AML) protections for those years.

Among other cases, Reuters mentions the hacking of Eterbase, with some of the proceeds being laundered through Binance by North Korean hacker group Lazarus, and Binance’s association with Russian-language drug mart Hydra.

A Binance spokesperson disputed Reuters’ findings, and the exchange told Forbes in a statement that the report is a “woefully misinformed op-ed that uses outdated information from 2019 and unverified personal attestations.”

Binance is already the object of several U.S. federal investigations, including another SEC probe. The U.S. Commodity Futures Trading Commission began an investigation of the exchange’s trading practices last year.

Binance Markets, its United Kingdom branch, was ordered by the Financial Conduct Authority to cease activities in that county after a review of its operations last year. Additionally, Binance was ordered to cease operations in Ontario last June, although it remained active in the Canadian province until March of this year.

Finance Redefined: Maker founder proposes endgame, Singapore explores DeFi and more

Top DeFi tokens broke out of the month-long bearish pressure to trade in the green and the total value locked in DeFi protocols saw a minor recovery amid continuous price volatility.

The past week in the decentralized finance (DeFi) ecosystem saw many new developments, including the rebirth of the Terra 2.0 blockchain. Meanwhile, Binance’s incubation platform Binance Labs launched a $500 million fund to support and promote Web3 adoption.

Singapore’s central bank partnered with JP Morgan to explore DeFi applications in wholesale funding markets by establishing tokenized bonds. KuCoin launched its very decentralized wallet with DeFi and nonfungible token support.

The top-100 DeFi tokens showed signs of a breakout from a month-long bearish trend, with most of the tokens showing overall gains in the past seven days.

Maker founder proposes MetaDAOs and synthetic ETH in ‘Endgame Plan’

MakerDAO co-founder Rune Christensen has issued a new monumental proposal to push the project into its final form called The Endgame Plan.

Across 3,000 words, including 35 detailed infographics, Christensen explained that the current model of governance at Maker creates a deadlock, making it difficult for the protocol to effectively process “complicated real-world financial deals” and compromising its competitiveness with financial institutions.

Binance Labs’ $500M fund to catalyze crypto, Web3 and blockchain adoption

Binance Labs, the investment arm of crypto giant Binance, launched a $500 million fund in partnership with global investors including DST Global Partners and Breyer Capital to drive innovation across the crypto, Web3 and blockchain landscape.

Binance Labs plans to allocate the latest $500 million fund to projects across various stages: incubation, early-stage and late-stage growth.

Sharing his take on accelerating the adoption of the crypto ecosystem, Binance CEO Changpeng Zhao noted the importance of a connection between values, people and economies.

Singapore to explore digital asset tokenization on public chains

The Monetary Authority of Singapore (MAS) has launched Project Guardian, a blockchain-based digital assets trial that will use tokenization. The project will include regulated financial institutions serving as “trust anchors,” with a pilot involving JP Morgan, DBS Bank and Marketnode, the SGX joint venture for bonds.

The Project Guardian initiative, which was announced during the Asia Tech x Singapore Summit on Tuesday, was spearheaded by Deputy Prime Minister and Coordinating Minister for Economic Policies Heng Swee Keat. It will see MAS explore DeFi applications in wholesale funding markets by establishing a liquidity pool of tokenized bonds and deposits to execute borrowing and lending on a public blockchain-based network.

KuCoin plugs into Web3 with new decentralized wallet

Cryptocurrency trading platform KuCoin has launched a new decentralized wallet platform as interest in Web3 continues to gather steam.

KuCoin Wallet is now live for users, with the browser-based platform paving the way for a mobile application, which is still in development.

The platform plugs into the KuCoin ecosystem and features cross-blockchain integration. Users will be able to buy, sell, trade and send a variety of cryptocurrencies, including Bitcoin (BTC), Ether (ETH) and Tether (USDT), in addition to other tokens.

DeFi market overview

Analytical data reveals that DeFi’s total value locked saw a trend reversal, with the value reaching above $80 billion again. Data from Cointelegraph Markets Pro and TradingView reveals that DeFi’s top 100 tokens by market capitalization registered a week filled with volatile price action but broke out of the bearish trend over the past couple of days.

The majority of the DeFi tokens in the top-100 ranking by market cap traded in the green, Aave (AAVE) was the biggest gainer with a 10.42% surge, followed by CurveDAO (CRV) with 10%. Theta Network (THETA) registered an 8% price rise, while Chainlink (LINK) grew 7%.

The relaunched Terra 2.0 network, which was listed by major exchanges following its revival on May 28, has seen a volatile price action since then. The Terra (LUNA) price fell by 70% on the first day of its trading and currently trading at one-third of its listing price.

Thanks for reading our summary of this week’s most impactful DeFi developments. Join us again next Friday for more stories, insights and education in this dynamically advancing space.

Crypto Biz: Helicopter CBDC money rains on Shenzhen, May 26—June 1

China’s advanced CBDC strategy sees digital yuan airdropped to thousands of people. Meanwhile, Binance Labs raised $500 million for a new Web3 fund.

China’s pandemic-hit economy needs all the help it can get after a surge in COVID-19 infections triggered mass lockdowns across the country. In an attempt to revive consumption, the southern city of Shenzhen used Beijing’s central bank digital currency, or CBDC, to airdrop free money to local residents. A similar strategy was used in the northern Hebei province, where even more digital yuan was deployed. Think of all the things governments can do when they have full control over fiat money on-ramps.

This week’s Crypto Biz newsletter explores China’s helicopter CBDC strategy, the latest funding news from the world of blockchain and whether Apple is getting closer to integrating nonfungible token (NFT) technology.

Binance Labs’ $500M fund to catalyze crypto, Web3, blockchain adoption

The biggest funding news of the week comes courtesy of Binance Labs, which announced plans to allocate a whopping $500 million to Web3 and blockchain startups. The new funding initiative, launched in partnership with DST Global Partners and Breyer Capital, will focus on incubation as well as early-stage and late-stage growth companies. Such mega-funds are nothing new for crypto. But, it’s interesting that venture capital is pouring even more money into the industry at a time when crypto prices are plummeting. Things aren’t always what they seem on the surface.

What is #Binance Labs?

It’s the venture capital and incubation arm of #Binance that identifies, invests, and empowers viable blockchain entrepreneurs, startups, and communities.

Learn more ⤵️https://t.co/4xl7jm7hRQ

— Binance (@binance) May 30, 2022

Goldman Sachs reportedly eyes crypto derivatives markets with FTX integration

Goldman Sachs’ foray into the crypto market appears to be deepening every week. The latest news is that the United States banking giant wants to onboard some of its derivatives products into FTX.US, one of the leading crypto derivatives exchanges. The reason for this integration, according to financial news outlet Barron’s, is that Goldman wants to offer crypto derivatives products using its own tools. It looks like Goldman’s derivatives customers will be joining retail in getting wrecked during the next major market downturn. Or, perhaps I’m being too negative? Read about liquidation cascades before you decide.

City of Shenzhen airdrops 30M in free digital yuan to stimulate consumer spending

You’ve heard of helicopter money before. Well, the city of Shenzhen is making it a reality by airdropping 30 million digital Chinese yuan (e-CNY) to local residents in an effort to boost consumer spending. To qualify for the airdrop, locals must register with the food delivery app Mietuan Dianping. If selected, they’ll have the ability to spend their digital yuan at more than 15,000 merchant terminals. For better or worse, you’re getting a glimpse into how governments will use central bank digital currencies to achieve macroeconomic objectives. But yes, there are plenty of downsides to CBDCs, too.

Apple’s upcoming developer conference sparks rumors of NFT trading cards

Apple’s upcoming Worldwide Developer Conference, also known as WWDC, has sparked interest from the crypto community amid rumors that the iPhone maker was looking to integrate NFT trading cards — the rumors aren’t unfounded, either. The fanatics over at MacRumors apparently clicked on the Memoji characters being showcased on new Apple devices and software models and discovered three trading card characters available to be claimed. The good news is we won’t have to wait long for the rumors to be either confirmed or squashed as WDCC takes place next week.

Don’t miss it! How does the Fed impact your crypto?

There has been a lot of talk about the Federal Reserve and interest rates over the past few months. After lying to us about inflation, the Fed has been forced to do a complete U-turn on monetary policy to bring down cost pressures. So, whether you like it or not, the cabal of central bankers who meet eight times a year have a major impact on your portfolio — and this includes crypto. In this week’s Market Report, we explain how the Fed is pulling the strings. Click below to watch a full replay of the show.

Crypto Biz is your weekly pulse of the business behind blockchain and crypto delivered directly to your inbox every Thursday.

Binance’s CZ says he is ‘skeptical’ about the Terra relaunch

Binance CEO CZ voices skepticism around the relaunch of the Terra blockchain and its new LUNA token following the latest fiasco.

Binance CEO Changpeng Zhao, also known as CZ, expressed skepticism around the revival plan for the Terra ecosystem and the launch of the new LUNA token.

“I try not to predict what the community will do. […] Many are skeptical. I’m one of those guys,” said CZ in an exclusive interview with Cointelegraph.

Following the collapse of TerraUSD (USD), the Terra ecosystem’s stablecoin, CZ criticized its team for not handling the crisis properly and pointed at the project’s flaws that led to the crash. Still, Binance is now actively participating in Terra’s revival plan by hosting the airdrop of its new LUNA token.

As CZ pointed out, despite the widespread skepticism around the Terra relaunch, Binance has a responsibility to help users affected by the crash of LUNA.

“We still need to ensure continuity of people’s access to liquidity. […] We have to support the revival plan hoping that it may work,” he explained.

According to CZ, the Terra fiasco should serve as a warning to projects that rely on unsustainable business models based on “aggressive incentives.”

As he pointed out, crypto projects such as Terra offer high yields to attract people in the hopes that once there are enough users, they will become profitable.

“We should really look at them in a fundamental way to measure that more revenue, more income is generated than just an incentive payout,” CZ pointed out.

Check out the full interview on Cointelegraph’s YouTube channel, and don’t forget to subscribe!

Goldman Sachs reportedly eyes crypto derivatives markets with FTX integration

FTX has sought to integrate brokerage services internally to fulfill trades automatically, however, CFTC has called for greater scrutiny of the demand as it would lead to a monopoly of big players.

Goldman Sachs, one of the leading investment banks in the United States is reportedly trying to onboard some of its derivatives products into FTX.US crypto derivatives offerings.

Goldman Sachs has been in talks with FTX over regulatory and public listing help, and aims to expand into offering crypto derivatives by leveraging some of its own derivatives tools and services, reported Barron’s.

FTX.US, the U.S. subsidiary of global cryptocurrency exchange FTX is currently seeking to offer brokerage services for its derivatives offerings. This would allow the crypto exchange to handle the collateral and margin requirements internally rather than depending on “futures commission merchants” (FCMs). FTX.US president Brett Harrison said:

“We have multiple FCMs already committed to integrating technologically with the exchange. There are several large ones you can probably name.”

The U.S. Commodity Futures Trading Commission (CFTC) has sought public comments on the requested amendment from the crypto exchange. The chief regulatory body also believes that FTX’s proposal warrants scrutiny as it would lead to a monopoly by large investment banks such as Goldman.

According to people familiar with the matter, the integration of Goldman Sachs derivatives services would offer “trading futures directly, introducing clients and acting as an on-ramp to the exchange, or providing capital top-ups for clients.”

FTX has argued that an integrated brokerage model would help in making the market more stable and free. In a recent roundtable discussion with the CFTC, CEO Sam Bankman-Fried fielded several questions about crypto derivatives and FTX’s proposal to integrate its own FCM.

Crypto derivatives trading has been a topic of debate for quite some time, with many European countries and even the United States prohibiting most of the crypto exchanges from offering leveraged trading. Binance had to shut its derivatives offerings in several European countries post regulatory interventions.

On one hand, CFTC has called for greater scrutiny of FTX’s amendment demand. On the other, FTX argues that an integrated brokerage model would help them to calculate margin requirements every 30 seconds rather than waiting until the next day to liquidate positions.

Binance Labs’ $500M fund to catalyze crypto, Web3, blockchain adoption

Binance Labs plans to allocate the latest $500 million fund to projects across various stages — incubation, early-stage and late-stage growth.

Sharing his take on accelerating the adoption of the crypto ecosystem, Changpeng “CZ” Zhao, CEO of Binance, revealed the importance of a connection between values, people and economies:

“The goal of the newly closed investment fund is to discover and support projects and founders with the potential to build and to lead Web3 across DeFi, NFTs, gaming, metaverse, social, and more.”

Binance Labs was established in 2018 and has since invested in and incubated more than 100 projects globally. Some of the prominent companies in its portfolio include 1inch, Axie Infinity, Dune Analytics, Elrond, Polygon and The Sandbox.

Fun fact, Binance Labs had also invested $3 million in Terra’s layer-0 blockchain back in 2018.

Speaking to Cointelegraph, Binance Labs’ executive director of investments and M&A Ken Li said that there are 14 projects that are participating in the Season 4 of the Incubation Program and they will receive the first funding from the new fund.

The eligible startups are Grindery, NuLink Network, FilSwan and Starton from the infrastructure sector; CODA and OpenLeverage from the DeFi sector; CoralApp, AlterVerse Inc, ChapterX and Gamic Guild from the gaming and metaverse sector; Qwestive and Reveel from the SocialFi sector; Playbux (MyCashBack) and Ambrosia Finance from the crypto fintech sector.

Several former Binance executives led funding rounds in helping multi-strategy blockchain investment fund Old Fashion Research (OFR) invest in over 50 blockchain projects in just one year.

As Cointelegraph recently reported, the fund was founded by Ling Zhang, the former vice president of mergers and acquisitions and investments at Binance and Wayne Fu, former Binace head of corporate development.