Binance Halts Bitcoin Withdrawals For Second Time In 12 Hours

Crypto exchange Binance halted Bitcoin (BTC) withdrawals for the second time on May 8, citing a large backlog of pending withdrawals.

Binance tweeted on May 8 that it was shutting down BTC withdrawals “temporarily” as there was a “large volume of pending transactions.”

It added that the transactions were still being processed, as the “fixed fees did not anticipate the recent increase [Bitcoin] grid gas charges.”

The exchange issued an update nearly two hours after the initial tweet, saying it “replaces the pending [Bitcoin] withdrawal transactions with a higher fee so that they are picked up by mining pools.”

Almost three hours after the initial tweet, Binance said Bitcoin withdrawals had resumed with pending transactions being processed with higher transaction fees.

It added that it was working on enabling withdrawals via the Lightning Network which it claimed could help reduce such withdrawal stoppages in the future.

Earlier on May 7, Binance also had to temporarily suspend Bitcoin withdrawals, claiming there was an overflow of transactions on the blockchain. The outlet reopened over an hour and a half later.

At the time, the Bitcoin mempool had a backlog of around 400,000 transactions waiting to be processed. It swelled to nearly 485,000 at the time of Binance’s second withdrawal halt, according to data from mempool.space.

A mempool is an area where transactions on the Bitcoin network “wait” before being verified by each blockchain node.

Binance saw significant Bitcoin net negative outflows on May 7 with around 175,650 BTC worth around $4.95 billion flowing from the exchange on the day according to data from CryptoQuant.

Binance claimed this outflow data was actually moving Bitcoin between their hot and cold wallets.

The price of Bitcoin has also fallen about 3.5% from its weekly high of over $29,700 on May 6, according to Cointelegraph data.

A spokesperson for Binance told Cointelegraph that it had “no further details to add at this time.”

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Update (8 May 02:43 UTC): This article has been updated with additional information from Binance on why it suspended withdrawals.

Update (8 May 03:35 UTC): This article has been updated with Bitcoin price data and net outflow data from CryptoQuant.

Update (8 May 03:45 UTC): This article has been updated with additional information from Binance.

Update (May 8 at 04:20 UTC): This article has been updated to include a response from a Binance spokesperson and updates from Binance’s Twitter.