Binance Bitcoin Withdrawal Stop Pause Blockchain Congestion Twitter

Binance, the leading global cryptocurrency exchange, recently made the decision to temporarily halt Bitcoin withdrawals for the second time within a span of about 12 hours on Monday. The reason for this action was attributed to blockchain congestion caused by a significant number of pending transactions. Binance tweeted that the suspension was due to the presence of a significant volume of pending withdrawal transactions, a circumstance that the exchange did not anticipate in light of recent increases in Bitcoin gas fees.

Gas fees, which represent the expenses users bear for blockchain validation during each transaction, experienced a significant increase recently. This increase was a result of increased interest in BRC-20, a new token standard that led to the introduction of a number of memecoins this year.

The withdrawal suspension originally occurred on Sunday, lasting about one hour, with Binance citing network congestion as the primary cause. In contrast, other major crypto exchanges such as Coinbase and Kraken did not communicate any plans to suspend withdrawals.

Introduced earlier this year by a coder called “Domo”, BRC-20 enabled the distribution of new tokens on the Bitcoin blockchain. Consequently, several memecoins appeared, giving rise to a speculative trading frenzy, as individuals eagerly sought to become early buyers in this wave of tokens.

As a result of increased trading activity on the Bitcoin blockchain, gas fees reached their highest levels in nearly two years. Unfortunately, this increase in activity also led to traders falling victim to a series of pump-and-dump schemes, a recurring phenomenon in the crypto market.

Notably, Binance had listed several of the new meme coins created under the BRC-20 standard, most notably the PEPE token. However, the exchange had warned users about the potential for a speculative bubble, stressing that these tokens lacked practical utility.

On Monday, the broader cryptocurrency market showed signs of weakness, with Bitcoin falling 2.2 percent. Similarly, Binance’s native token, BNB, experienced a 1.5 percent drop, while the second largest cryptocurrency, Ethereum, saw a nearly 2 percent decline.

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