- Binance, the world’s largest crypto exchange, paused bitcoin (BTC) withdrawals twice due to unprecedented congestion in the Bitcoin network.
- The number of unconfirmed Bitcoin transactions hit a record high of nearly 400,000, causing transaction fees to double since March and reach a two-year high.
Bitcoin Network Congestion Causes Binance to Pause Withdrawals
Binance, the largest cryptocurrency exchange in the world, was forced to temporarily halt bitcoin withdrawals on Sunday due to congestion in the Bitcoin network. The network was overwhelmed with nearly 400,000 unconfirmed transactions, the highest ever recorded, resulting in sky-high transaction fees. Binance resumed withdrawals within two hours of its initial announcement on Twitter.
Pending transactions are being processed by replacing them with higher transaction fees.
We'll post another update once these pending transactions are all processed.
— Binance (@binance) May 8, 2023
However, the exchange had to pause withdrawals again after eight hours due to continued congestion.
The increase in transaction fees is an anomaly, according to Colin Harper, head of content at Luxor Technologies. The adoption of the BRC-20 standard has caused fees to rise, resulting in a 309% increase in transaction fees since last year. Binance has adjusted its fees to prevent future congestion and is integrating Lightning Network withdrawals to alleviate the problem.
Bitcoin Ordinal Inscription Tokens Have a Market Cap of $482 Million
Bitcoin ordinal inscription tokens have a market capitalization of $482 million across 14,000 tokens. The BRC-20 standard is a new way to inscribe tokens, and its adoption has driven up fees. The current average transaction fee of just over $8 is a 309% increase from last year. Bitcoin is currently trading at $28,935, down 0.15% in the last 24 hours.
Binance Resumes Bitcoin Withdrawals After Second Pause
Binance has resumed bitcoin withdrawals after its second pause, which lasted just over two hours. The number of unconfirmed transactions approached 500,000 when the second halt occurred, up from nearly 400,000 when the first pause occurred. The number is now declining, with just over 430,000 unconfirmed transactions recorded over a 12-hour period.
Bitcoin is now trading at $28,240, down 2.6% in the last 24 hours.
Binance has adjusted its fees to prevent future congestion and is integrating Lightning Network withdrawals to alleviate the problem. Binance has also significantly slid in its position for bitcoin trading volume and is no longer in the top 10 exchanges for bitcoin trading pairs, according to CoinGecko data.