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Binance Suspends Bitcoin Withdrawals Due to Transaction Backlog Caused by the Crypto Market Selloff

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Binance Suspends Bitcoin Withdrawals Due to Transaction Backlog Caused by the Crypto Market Selloff

Summary:

  • Binance has temporarily paused Bitcoin withdrawals on the exchange due to stuck transactions causing a backlog.
  • The team is currently working on a solution, and further explains that the backlog is being caused by a batch of Bitcoin transactions with low transaction fees.
  • Bitcoin withdrawals on other networks (BEP20 and ERC20) through wrapped tokens are open and working as normal.

The crypto exchange of Binance has announced that it has temporarily suspended Bitcoin withdrawals on the exchange due to a backlog of stuck transactions.

According to the Binance team, the backlog is a result of Bitcoin transactions getting stuck due to low transaction fees being submitted. The team is currently working on a solution and advises that Bitcoin withdrawals on other networks (BEP10 and ERC20) through the respective wrapped tokens are open and continue working as normal.

Binance also shared the progress of the Bitcoin withdrawals on Twitter, as seen in the following Tweets.

Our team is working on a solution to resume withdrawals as soon as possible. Stay tuned for further updates and timelines.

We apologise for any inconvenience caused.

More info ⤵️https://t.co/HH3Bi55JZ8

— Binance (@binance) June 13, 2022

CZ States it Might Take Longer to Fix Than Initially Estimated

Similarly, Binance CEO, CZ, also updated on the pausing of Bitcoin withdrawals via Twitter. Initially, he gave a thirty-minute timeline for the issue to be fixed, only to update that it might take longer to resolve than he had thought. He said:

Temporary pause of BTC withdrawals on Binance due to a stuck transaction causing a backlog. Should be fixed in ~30 minutes. Will update. Funds are SAFU.

This is only impacting the Bitcoin network. You can still withdraw Bitcoin on other networks like BEP-20. Likely this is going to take a bit longer to fix than my initial estimate. More updates soon. Thanks for your patience and understanding.

Bitcoin Continues on Its Downward Spiral

Bitcoin transactions causing a backlog on Binance could result from BTC’s ongoing market meltdown to a local low of $22,600. Bitcoin’s meltdown kick-off over the weekend and the King of Crypto has lost several important support zones along the way, beginning with $28k. They include: $27k, $26,700, $25k, and $23k.

However, on the bright side, a Bitcoin bottom could be found this year and earlier than anticipated. Dollar-cost averaging on spot markets using small USD amounts could be a better option than going all-in on Bitcoin right now. Caution is advised when attempting to catch the proverbial falling knives in the crypto markets.

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Ethereum

CoinFlex Will Issue $47M Worth of “Recovery Tokens” After Withdrawal Freeze

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CoinFlex Will Issue $47M Worth of “Recovery Tokens” After Withdrawal Freeze
  • CoinFLeX will issue recovery tokens to help fund customers’ withdrawals.
  • The exchange had run into trouble after one individual’s accounts went into negative equity, resulting in the halting of withdrawals.
  • It will issue $47 million worth of the Recovery Value USD (rvUSD) tokens.

Futures crypto exchange CoinFLEX will issue recovery tokens called Recovery Value USD (rvUSD) as a solution to enable withdrawals again. The platform has suspended withdrawals as a result of market volatility, with some users even having a negative balance as a result.

$47 million of the rvUSD will be issued, and CoinFLEX hopes that this will help clear the outstanding debt from that one individual who had a negative balance. A whitepaper covers the details of the token, and there are several caveats to become an investor. The minimum subscription is 100,000 USDC.

The exchange aims to reopen withdrawals by June 30, but this will be subject to receiving funds for the rvUSD issuance. CoinFLEX says that it has been speaking to large buyers and “believes there is significant interest in the terms presented.”

CoinFLEX also said that it plans to implement transparency measures going forward. Additionally, it will work on a new model of futures in direct response to the recent incident. Regarding the transparency, CoinFLEX said,

“The notional (USD) value of every account’s futures positions will be made publicly available via an external auditing firm that will attest to these futures positions every hour. We will also make available the margin (collateral) backing these positions in USD value and break down the collateral by type 1 (stablecoins), type 2 (highly liquid coins), and type 3 (low liquidity coins).”

Crypto Community Not Too Convinced About rvUSD

The crypto community’s response to CoinFLEX’s rescue method has been ambivalent. FatMan, who has been known for his analysis of the Terra incident, called the move “amazingly degen.”

He summarizes the whole incident as the platform offering the individual a $47 million uncollateralized loan, turning his debt into a token while offering 20% APY on it. In other words, they are using this token to fund other customers’ withdrawals.

This may sound like something too good to be true — and that might very well be the case. Such unusual and potentially risky strategies will invite the attention of regulators like the United States Securities and Exchange Commission (SEC). That is the fear that some investors have, but it remains to be seen if this will actually play out that way.

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Crypto.com Removes 13 Crypto Tokens From Its Earn Program Including Shiba Inu, Dogecoin and Tezos

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Crypto.com Removes 13 Crypto Tokens From Its Earn Program Including Shiba Inu, Dogecoin and Tezos
  • Crypto.com has removed 13 crypto tokens ,including Shiba Inu, Dogecoin and Tezos from its Earn program. 
  • The exchange has added Fantom, Ziliqa and Near to its Earn portfolio. 

Crypto.com, a leading cryptocurrency exchange, has decided to remove 13 cryptocurrencies from its Earn program. The exchange took to Twitter to share the update adding that it will be removing Doge, Shiba Inu, Tezos, and more from the program and will be adding Zilliqa, Fantom and Near to its Earn portfolio. 

Crypto.Com Has Removed 13 Cryptocurrencies From Its Earn Program

Crypto Earn is an initiative started by crypto.com to help users allocate their preferred crypto into the program to start accruing rewards. This would eventually help users expand their crypto assets by accumulating additional rewards in multiple cryptocurrencies. 

However, in an updated blog published earlier today, the exchange has decided to remove 13 crypto coins from its earn program including Doge, Shib, XTZ, MKR, EOS, OMG, FLOW, KNand C, ICX, COMP, BIFI, ONG, GAS, STRAX, and BNT. However, the exchange will also be adding three new tokens to its earn portfolio, i.e Zilliqa, Near, and Fantom. Per the updated blog post, users will be able to earn 5% rewards on FTM, and 6% rewards on ZIL and NEAR. 

“Effective from 27 June 2022, 10:00 UTC, we will be adding new tokens to Crypto Earn. Users can now enjoy rewards rates of up to 5% p.a. for FTM, and 6% p.a. for ZIL and NEAR.”

Crypto Community Reacts To Crypto.com’s Removal Of 13 Tokens. 

The response to crypto.com’s decision to remove 13 crypto tokens was mixed with multiple users expressing their discontentment on Twitter. Some users opined how the current crypto staking percentages are similar to the modern-day banking rates. 

Reduction of interest rates on stable coins again… no point holding them in your app. Get similar interest in a bank

— will (@WJB2201) June 27, 2022

While others responded that they were particularly unhappy about the exchange’s decision to remove Doge and Shib from its platform.

Why no more Shiba and Doge staking?

Are you trying to get people to leave your platform?

That was the reason I even started a CDC account!

— M42boost (@m42boost) June 27, 2022

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Ethereum’s Merge to Reduce Demand for GPUs, says Morgan Stanley

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Ethereum’s Merge to Reduce Demand for GPUs, says Morgan Stanley

Summary:

  • According to a Morgan Stanley analyst, demand for GPUs should reduce with Ethereum transitioning into a proof-of-stake network.
  • The crypto drawdown has further reduced the profitability of Ethereum mining.
  • However, the Ethereum mining community could venture into alternatives such as Ethereum Cash and Ravencoin.

Ethereum’s transition from a proof-of-work algorithm to proof-of-stake through the Merge of the Beacon Chain with the ETH mainnet could reduce demand for GPUs.

According to a research note by Morgan Stanley’s equity strategist Sheena Shah, the less energy-intensive proof-of-stake will reduce demand for GPU miners. In addition, the crypto drawdown in the markets has also resulted in reduced profits for Ethereum miners, further eliminating the need for GPUs. The note said:

and Ethereum currently require powerful computers for the mining process and consume a lot of energy which governments and regulators are increasingly concerned over. If Ethereum moves to using Proof-of-Stake (PoS) it will eliminate the need for miners (reducing demand for GPUs) and drastically reduce energy requirements.

Ethereum Miners Could Find Alternatives in Ethereum Classic and Ravecoin – Bloomberg.

However, in another analysis by Bloomberg in mid-June, it was forecasted that Ethereum miners would probably keep mining till the Merge occurs later this year. Furthermore, some miners considered transitioning their Ethereum miners to mine Ethereum Classic or Revencoin.

The team at Ethereum Classic has already started enticing existing Ethereum miners by requesting that they plan their migration to ETC before the Merge occurs. They further emphasized that Ethereum Classic was more than able to handle the abandoned Ethash hashrate. They explained:

This Merge event will disenfranchise the largest EVM’s Proof of Work mining ecosystem. Ethereum Classic is well positioned to absorb much of this abandoned Ethash hashrate.

However, Ethash miners might not realize that Ethereum Classic operates a modified version of Ethash called ETChash.

The Ethereum Classic team also pointed out that the Thanos Upgrade in November 2020 slowed the hashrate of the DAG. This, in turn, ‘has allowed GPU miners to operate their equipment longer on ETChash than Ethash.’ They added:

New ETChash miners will find comfort in knowing that Ethereum Classic made a long-term commitment to Proof of Work consensus through the network’s Die Hard Upgrade in 2018.

If you’re new to the ETC mining ecosystem, you’ve found a long-term home on Ethereum Classic. A battle-tested network where you can properly plan your mining business’ capital and operational expenditures around a predictable monetary policy and stable network that is widely integrated throughout the cryptoverse.

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