'Bubble Burst' Actually Advantageous to Crypto Market, Binance Labs Head Says
The initial coin offering (ICO) bubble will burst. This is one of the major events closely being monitored by those who are involved in the crypto market. Some fear that the burst will be cataclysmic for the digital currency market, but others have opposite sentiments.
Ella Zhang, head of Binance Labs, said that the burst will actually be good for the industry, Cointelegraph reported. She said that this event would cause the rise of veritable projects in the crypto market, although she didn’t share any predictions as to when such an event will occur.
“We’d like the bubble to break,” the head of Binance Labs said. “We still see a lot of hype in the market, valuations are high and unreasonable. We really think if the bubble bursts, it’s a good thing for the industry,” she added.
Binance recently announced that it is going to extend a helping hand to crypto startups that are struggling to gain funding for their projects. The company means to accomplish this using a $1 billion investment fund.
However, there are several conditions that Binance requires for the startups chosen. One is that they must avoid participating in “pump and dump” methods, the act of inflating the financial worth of a digital asset then selling it once it gets a flattering value.
They’re also required to focus on developing the product outlined on their white paper. If startups fail to adhere to these requirements, Binance will be forced to cut off their funding and delist them from their partnership.
Additionally, these startups are obligated to be part of the Cryptocurrency Governance Initiative (CGI). The aim of this project is to “fight scams and sh*t coins, and to boost crypto and blockchain technology.” Binance is essentially trying to expand the crypto economy as a whole and suppressing illicit activities by malicious companies at the same time.
As for the capital, it is called Community Influence fund, which will allocate an average investment of $1 million to $10 million, depending on what projects these startups mean to accomplish. Binance already has 20 different parties which the company is interested in collaborating with and is looking to add more to their ranks.