Cryptocurrency exchange Gate.io announced the launch of an industry recovery fund following similar efforts by other exchanges.
Gate.io said its $100 million liquidity support fund would be available to all industry participants. In addition to “high-frequency trading institutions [and] high-quality listing projects,” these also include high net-worth individuals and other platforms.
Each can apply for up to $10 million in equivalent token funding support for market making and trading on Gate.io’s spot and futures markets.
Gate.io also said that funding could additionally be used independently within the scope of risk control. The platform specified no deadline for the application, adding it could increase funding based on market conditions.
Industry Recovery Funds in the Spotlight
Gate.io’s efforts follow similar industry support schemes launched by other crypto exchanges in the wake of FTX’s collapse. Binance launched the highest profile initiative so far, announcing it in the days following the collapse. Chief executive Changpeng Zhao said the industry recovery fund would support relatively robust projects struggling due to exposure to FTX.
Binance committed an initial $1 billion to the fund, with an option to increase the amount by another $1 billion. The largest scheme by far, it has also attracted support from other participants who have pledged $50 million between them. Meanwhile, rival crypto exchange Bybit also announced its own $100 million industry recovery fund.
Given these significant efforts on behalf of other industry participants, some could wonder about the intention behind Gate.io’s contribution. The platform could be hoping to rehabilitate its image following a recent incident involving its Twitter account.
Fraudsters managed to hack Gate.io’s Twitter account and used it to promote a phishing scam. The hackers shared a link that directed users to a landing page promising a $500,000 USDT giveaway. Users who then connected their wallets to the site would have their assets stolen by enabling the hackers with access.
Gate.io later confirmed the hack and assured that it had taken swift action to remedy the situation. The platform said that affected users would be compensated for any losses due to the breach of its Twitter account. The launch of its recovery fund could feasibly be construed as an effort to regain some credibility in the industry.
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