Binance Raises Fees as Bitcoin Withdrawals Pause Twice in 24 Hours
Binance Pauses Bitcoin Withdrawals, Forces Fee Increase
• Binance has paused withdrawals on the Bitcoin network due to high congestion.
• The exchange was forced to raise fees for pending transactions in order to compete for block space.
• This rise in block space demand has been blamed on growing adoption of Bitcoin Ordinal inscriptions.
Congestion Causes Double Pause
The Bitcoin network is experiencing a significant amount of congestion, which has led Binance to pause Bitcoin withdrawals twice in just a few hours. In order to better compete for block space and get transactions verified by miners, Binance was forced to place higher fees on pending withdrawal transactions. This came after the crypto exchange had temporarily closed all BTC withdrawals earlier that day due to the congestion issue.
Ordinals Blamed For Congestion
At the time of writing, over 444,000 transactions are pending on the Bitcoin network per mempool.space data, surpassing levels seen during previous bull market cycles. The increase in block space demand has been attributed to rising adoption of Bitcoin Ordinal inscriptions – a type of tokenized asset built on top of Ethereum’s blockchain technology.
Rise Sparks Concerns About Exchange Security
The pauses caused some concern about the security of funds stored within Binance wallets due to its inability to anticipate fee surges and complete transactions with set fees quickly enough. However, Binance’s Twitter account reassured users that their funds were safe and it is working hard to accelerate confirmation times for all pending transactions.
Bitcoin’s network congestion has led Binance into having twice pause withdrawals and be forced into raising fees for pending transactions in order to stay competitive with miners verifying blocks on the network. The rise in block space demand has been attributed mainly towards growing adoption of Ordinal tokens inscriptions while concerns have risen around security at the cryptocurrency exchange itself.