Looking to foster growth within the industry, world leading exchange BINANCE, is reportedly establishing a $1 billion USD fund to be used on venture capitalism. They are calling this an ‘eco-fund’. It is intended that this will be used to help develop early stage blockchain start-ups. With the industry booming, there is less of a need to look outside the realm of blockchain towards traditional finance for funding. As exchanges like Binance grow, we will see more funds like this, recycling wealth throughout the industry.
This isn’t just a fantastic, generous gesture on their behalf though. The investments being made will utilize the popular exchanges own token – BNB. Currently BNB has a marketcap of over $1.5 billion USD according to CoinMarketCap. This token is commonly used by not only those that believe in the growth of Binance, but those looking to save on transaction fees, as its use on their own platform gives the traders a discount. In incubating various blockchain projects with this fund, they are further establishing their own token and a variety of endeavours. They are hoping that funds such as this will further separate them from the pack of popular exchanges. Binance routinely swaps places with OKEx as the exchange with the most daily traded volume.
Those looking to be taken under the wing of Binance must meet certain requirements to be eligible for funding. Binance will be making the funds available to applicants that already manage over 100 million in assets, and have a history of faith in the blockchain industry. Obviously Binance will do their due diligence on applicants, as they are required to submit all of their information. Once approved, successful recipients of funding will be known as a Binance Lab partner. The fund will be limited to 20 partners.
Although there has not been a public announcement of the fund, listen for one in the coming days. The head of Binance Labs, Ella Zhang, stated herself in a recent conference the details of the fund. She went on to detail how they are most interested in long-lock projects. They want to invest in true believers of the industry, which will be around in the years to come.
Binance has already announced the first of their projects they intend to incubate. Announced in the same conference that the fund was, the project is a “Taxi Chain”. The project is a ride-hailing/delivery platform reminiscent of Uber, and Lyft. This is an already established company, functioning in China. The plan is to launch an accompanying app, and utilize the benefits that blockchain offers. Co-founder Weixing Chen stated, “With the use of blockchain, we can build a set of economic systems different from the previous ones…We can direct traffic from the Internet and add on different services to meet users’ needs…Ride hailing is the first time blockchain will be tested on a social application on mass scale.”