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Binance Labs No Longer Part of Binance as Exchange Severs Venture Capital Arm

Last Updated March 15, 2024 12:07 PM
Teuta Franjkovic
Last Updated March 15, 2024 12:07 PM
By Teuta Franjkovic
Verified by Peter Henn

Key Takeaways

  • Binance Labs has become a separate entity from Binance.
  • The firm’s staff now operate under independent contracts, mirroring the structure of the BNB Chain.
  • This move reflects a growing trend of major crypto exchanges establishing venture capital arms.

Earlier this year, in a significant move under the four-month leadership of Chief Executive Officer Richard Teng, Binance discreetly separated  its $10 billion venture capital division.

Binance Labs has now established itself  as an independent entity, distancing itself from the broader Binance organization, according to a spokesperson for the former unit.

Binance Labs Goes Independent, Licenses Brand for New Venture

This shift includes Binance Labs staff transitioning to contracts distinct from those of Binance exchange employees. As a result, the new company’s operational structure is more closely aligned with that of the BNB Chain, a digital ledger backed by Binance. This development marks a notable shift in Binance’s approach to managing its various arms and investments.

Binance Labs Investment Director Alex Odagiu stated  that the organisation was no longer a part of the Binance group. He mentioned that the venture capital affiliate would license the Binance brand for its operations.

The cryptocurrency industry is closely monitoring developments at Binance, the leading digital asset exchange globally, following a plea agreement with US regulatory bodies in November. This agreement resulted in a substantial $4.3 billion fine and the removal of founder Changpeng Zhao from his CEO position.

Binance did not immediately respond to a request for comment.

Labs Cuts Ties With Binance Group, Focuses on Crypto Future

Earlier in 2024, a disclaimer  appeared on the Binance Labs website, stating the entity is “an independent venture”. It added that it was “not affiliated with the Binance Group, nor does it participate in any business activities conducted by the Binance Group. This includes, but is not limited to, the Binance cryptocurrency exchange”.

Yi He, who co-founded Binance with Zhao, heads Binance Labs. Profits from the exchange mainly finance the venture capital arm. It is also known for being an active supporter of early-stage cryptocurrency projects.

Binance Labs operates both as a venture capital investor and an incubator. It has one program dedicated to startups developing on the BNB Chain and another that supports projects regardless of their blockchain affiliation.

BL Surpasses $10 Billion in Asset Value

The organization has made investments in around 250 projects. These include such notable names as Sky Mavis, Aptos Labs, LayerZero, Polygon, and The Sandbox. These investments have propelled the venture’s assets to surpass a paper value of $10 billion, as revealed in a recent announcement by Binance Labs regarding the opening of applications for its seventh incubation program season.

Similar to Binance Labs, other leading crypto exchange operators like Coinbase Global Inc., Kraken, and OKX have also ventured into the venture capital domain. In 2023, Coinbase Ventures ranked as the second most active investor in the cryptocurrency sector, based on data from PitchBook.

Despite Binance Labs’ operational independence, the venture’s core mission of the venture is still unchanged. Alex Odagiu said : “Our primary goal is to identify projects and invest in them, and this has not changed.”

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