Cryptocurrency exchange Binance halted bitcoin withdrawals twice within 24 hours on Sunday and Monday, citing heavy cash out volumes.
For 90 minutes on Sunday morning and again for a few hours later Sunday night, Binance stopped all bitcoin withdrawals on its platform, saying there were too many pending transactions.
“Our team is currently working on a fix until the network is stabilized and will reopen $BTC withdrawals as soon as possible. Rest assured, funds are SAFU,” the exchange said, referring to the company’s Secure Asset Funds for Users, a means of insuring user deposits.
Twenty-four-hour trading volume on Binance was $6.9 billion, according to analytics site CoinMarketCap—more than eight times the next-largest exchange, Coinbase.
The second pause came less that eight hours later, with almost 500,000 transactions waiting to be sent, CoinDesk reported.
Binance said it had not been prepared for the surge in withdrawal demand, which drove up the fee set by crypto miners who provide the computing power needed to process trades on the blockchain.
“There is a large volume of withdrawal transactions from Binance still pending as our set fees did not anticipate the recent surge in $BTC network gas fees. Our team is working to accelerate the confirmation of all pending transactions,” Binance said in an update on Twitter.
Binance said in order to clear the backlog, it would increase its withdrawal fee “so that [the transactions] get picked up by mining pools.”
Withdrawals resumed shortly before midnight New York time.
The company added after withdrawals resumed: “To prevent a similar recurrence in the future, our fees have been adjusted. We will continue to monitor on-chain activity and adjust accordingly if needed. Our team has also been working on enabling BTC Lightning Network withdrawals, which will help in such situations.”
“If the withdrawal amount is large, the gas fee required to process the transaction may also be large, especially during times of high network congestion,” Joshua Chu, group chief risk officer at blockchain technology group XBE, Coinllectibles, and Marvion.
“We need more information as to what has led to the large withdrawals.”
In March, Binance also suspended deposits and withdrawals, citing tech issues.
The temporary freezes in withdrawals pushed the bitcoin price down by 2.6 percent in 24 hours to around $28,200—its lowest in nearly a week.
However, the price of bitcoin saw a jump of more than 70 percent following the failure of multiple U.S. regional banks, with some deciding to hold bitcoin instead of cash amid an unfolding banking and liquidity crisis. Year to date, bitcoin remains down 9 percent.
Bitcoin dropped to lows of around $15,000 per bitcoin late last year.
