Recently, the Bitcoin Blockchain network was overloaded, causing Binance, the world's largest cryptocurrency exchange, to stop withdrawing Bitcoin from the exchange.
Binance stops supporting Bitcoin withdrawals
Around 9:30 p.m. on the evening of May 7 (GMT +8), the Binance exchange suddenly announced blocking the feature of withdrawing Bitcoin from the platform. According to Binance, this decision came from the Bitcoin Blockchain being overloaded, not the exchange's own problem.
“We are temporarily closing the Bitcoin withdrawal portal because the Bitcoin network is experiencing congestion. The Binance team is working on fixing the issue and will reopen the withdrawal portal as soon as possible,” posted on Binance's official Twitter channel.
Binance exchange temporarily closed the Bitcoin withdrawal gate.
After about 2 hours, the congestion was resolved and the withdrawal gate was opened. However, experts assess that this may not be a problem unique to the Bitcoin Blockchain network as Binance explains. In fact, not long before the time of congestion, Binance was trading a very large amount of Bitcoin.
Specifically, according to CryptoQuant Alert, there were 10,035.46 Bitcoins put on the exchange (about 290 million USD), and 117,459 Bitcoins withdrawn from the exchange (about 3.372 billion USD). It is not excluded that the migration comes from Binance changing the cold wallets it stores.
Some customers argue that Layer2 solutions like the Bitcoin Lightning Network can help end the current congestion. However, according to technology expert Eyal Yablonka, Layer2 or similar solutions by themselves cannot completely solve the problem. Therefore, the technology world needs to find ways to improve the Layer1 Blockchains like Bitcoin or Ethereum.