Binance Suspends Bitcoin Withdrawals Again Amid BRC-20 Surge
The world’s largest cryptocurrency exchange, Binance, resumed Bitcoin (BTC) withdrawals last night, but it appears the issue has not been fully resolved.
Binance Suspends Bitcoin Withdrawals Again Amid BRC-20 Surge
Update at 11:00 AM
As of 11:00 AM on May 8th (Vietnam time), Binance has reinstated BTC withdrawals. Transactions in the queue are now being processed with higher fees.
To prevent future occurrences, the exchange has adjusted its transaction fee schedule.
$BTC withdrawals are now resumed on #Binance.
— Binance (@binance) May 8, 2023
Pending transactions are being processed by replacing them with higher transaction fees.
We'll post another update once these pending transactions are all processed.
Original Post:
As Coin68 reported, Binance announced a temporary halt on Bitcoin (BTC) withdrawals last night (Vietnam time) due to network congestion, with a surge in transactions pushing gas fees to record levels. The platform resumed withdrawals after a two-hour network issue resolution. However, by 8:00 AM today (May 8th), the exchange had to suspend Bitcoin withdrawals again due to the same issue.
On-chain data shows there are currently nearly 400,000 Bitcoin transactions pending confirmation, a record high surpassing previous peaks, including those seen during the 2018 and 2021 bull markets.
We've temporarily closed #BTC withdrawals due to the large volume of pending transactions.
— Binance (@binance) May 8, 2023
Our team is currently working on a fix and will reopen $BTC withdrawals as soon as possible.
Rest assured, funds are SAFU.
Unconfirmed Bitcoin Transactions. Source: mempool.jhoenicke.de
Meanwhile, the average transaction fee on the network has doubled since March, reaching its highest point in two years. The current Bitcoin transaction fee is $8.80, up 309% from a year ago.
Average Transaction Fees on the Bitcoin Network. Source: Ycharts
While Ethereum benefits from the memecoin frenzy, Bitcoin's gas fees are under pressure from the BRC-20 token explosion, similar to Ethereum's ERC-20, and Ordinals Inscriptions. Analysis shows that BRC-20 tokens now account for about 6% of all activity on the Bitcoin network. This growth has caused Bitcoin transaction fees to increase fivefold over the past two weeks.
Bitcoin Ordinal Inscription now has a market cap of $350.7 million with 21,000 tokens, and ORDI tokens are priced at $16.70.
ORDI Price Volatility Over the Month. Source: brc-20.io
Ordinals Inscriptions allow users to encode images and upload data to Bitcoin, creating NFTs similar to those on Ethereum. The BRC-20 token standard was born from this, with the Ordinals protocol implementing it on the Bitcoin network, enabling users to deploy, mint, and transfer tokens.
As Colin Harper, Content Director at Bitcoin mining firm Luxor Technologies, noted:
“The current fee levels are unusually high, primarily due to Inscriptions. The adoption of BRC-20 is driving transaction fees up.”
