WORLD | May 8, 2023

Crypto stocks drop after Binance halts bitcoin withdrawals for hours

/ Our Today

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Zhao Changpeng, founder and chief executive officer of Binance speaks during an event in Athens, Greece. (File Photo: REUTERS/Costas Baltas)


Shares of cryptocurrency- and blockchain-related companies fell in early trading hours on Monday (May 8) after Binance halted its bitcoin withdrawals for several hours due to heavy volumes and rising processing fees.

The halts pushed bitcoin, the world’s biggest cryptocurrency, down 2% to a one-week low of $27,900.

Crypto exchange Coinbase Inc fell 3.6%, while blockchain-farm operator Bitfarms Ltd dropped 5.1%. Crypto miners including Riot Platforms, Marathon Digital and U.S.-listed shares of Hut 8 Mining declined between 5.3% and 6.6%, tracking lower bitcoin prices.

A representation of the cryptocurrency is seen in front of Binance logo in this illustration. (File Photo: REUTERS/Dado Ruvic/Illustration)

Binance, the world’s largest crypto exchange, shut bitcoin withdrawals for an hour late on Sunday and about three hours on Monday, saying there was a glut of pending transactions because it hadn’t offered so-called miners a high enough reward to log the trades on the blockchain.

The company said its set fees did not anticipate a recent surge in bitcoin-network gas fees – the payments made to crypto miners whose computing power processes transactions on the blockchain.

“There were so much traffic congestion and also the gas fees were so high over the weekend … even by historical standards,” Oppenheimer’s Owen Lau told Reuters.

Binance said in a tweet that the company had adjusted its fees to “prevent a similar recurrence”.

In March, it had suspended deposits and withdrawals citing tech issues.


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