Key Points:
After Sunday suspending Bitcoin withdrawals, Binance is experiencing problems again.
BRC-20 transactions have caused network congestion and high transaction fees.
Binance is continuing to work on fixing the issue as soon as possible.
The biggest exchange in terms of trading volume, Binance, is still experiencing unusual troubles, having suspended Bitcoin withdrawals for the second time in a day due to severe congestion on the Bitcoin network.
Bitcoin withdrawals on the exchange have been temporarily halted once again, with the crypto exchange reporting a massive backlog of outstanding withdrawals. It tweeted on May 8 that it has “temporarily” suspended Bitcoin withdrawals due to “the large volume of pending transactions.”
We've temporarily closed #BTC withdrawals due to the large volume of pending transactions.Our team is currently working on a fix and will reopen $BTC withdrawals as soon as possible.Rest assured, funds are SAFU.
— Binance (@binance) May 8, 2023
According to on-chain statistics, there are presently approximately 400,000 Bitcoin transactions awaiting confirmation, which is more than any prior record, including the bull markets of 2018 and 2021.
Unconfirmed Bitcoin transaction count. Source: mempool.jhoenicke.de
Nonetheless, the average transaction price on the network has more than quadrupled since March, when it reached its high in the previous two years. Bitcoin’s current transaction cost is $8.8, up over 300% from a year ago.
Average transaction fees on the Bitcoin network. Source: Ycharts
Bitcoin, the most valuable cryptocurrency by market capitalization, lost about 3% and was trading at around $28,216 at the time of writing.
BTC price chart. Source: TradingView
Binance temporarily halted Bitcoin withdrawals for around two hours Sunday afternoon, US time, after the number of unconfirmed transactions reached an all-time high. After nearly 90 minutes, the exchange blocked Bitcoin withdrawals due to congestion on the token’s blockchain. With the demise of competitor FTX last year, the exchange is by far the biggest in the digital asset market.
As Ethereum benefits from the memecoin frenzy, the emergence of Ethereum-style BRC-20 tokens and Inscriptions Ordinals puts pressure on Bitcoin gas fees.
NFTs, or digital collectibles, are often built on Ethereum, the cryptocurrency’s most major commercial highway. Its appearance on the Bitcoin network signals a novel use of a blockchain that is most recognized for its value storage and payment capabilities. According to one study, BRC-20 accounts for around 6% of total Bitcoin network activity. This surge has caused Bitcoin transaction fees to rise five times in the last two weeks.
Binance also used the crypto term “rest assured, funds are SAFU” in its tweets to imply that client cash is secure. The exchange said that crypto withdrawals will be restored as soon as feasible and that it was striving to expedite the confirmation of any outstanding transactions.
DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
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