Data reveals that during the halt, over 400,000 transactions were waiting for blockchain node verification.
Binance, the largest crypto exchange in terms of daily trading volumes, has halted Bitcoin (BTC) withdrawals twice within 12 hours due to a massive backlog of pending transactions.
On May 8th, the crypto exchange took to Twitter to notify its customers about the decision to stop withdrawals.
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In a Twitter thread, Binance cited a "large volume of pending transactions" as the primary reason for the temporary suspension of BTC withdrawals.
Binance explained that the fees it set didn't account for the recent spike in Bitcoin network gas fees, causing transactions to remain pending.
In an effort to address this issue, Binance increased the transaction fees for pending Bitcoin withdrawal transactions so that mining pools would prioritize them.
Approximately two hours after the first announcement, Binance shared an update via Twitter, ensuring users that their transactions would soon be processed.
Shortly after that, Binance declared that Bitcoin withdrawals were back up and running, with pending transactions now being processed with higher fees. The crypto exchange also mentioned its plans to enable withdrawals via the Lightning Network, which could help prevent such withdrawal suspensions from happening again.
On May 7th, Binance also paused Bitcoin withdrawals, attributing the issue to a transaction overflow on the blockchain. It is worth noting that this suspension was lifted about an hour and a half later.
According to the data from mempool.space, during that time, the Bitcoin mempool saw a massive backlog, with over 400,000 transactions waiting to be verified by blockchain nodes.
The data from CryptoQuant revealed that on the same day, Binance experienced a significant net outflow of Bitcoin, with roughly 175,650 BTC (worth around $4.95 billion) leaving the crypto exchange.
When reached for comment, a Binance spokesperson stated that the firm had "no additional details to add at this time."
Following the Binance withdrawal halt and massive net outflows, the price of Bitcoin dropped by about 3.5% from its weekly high of over $29,700 on May 6th. At the time of writing, Bitcoin (BTC) retails for $28,234.07, recording a 2.58% decrease in the last 24 hours.
Binance had to temporarily halt Bitcoin withdrawals twice within a 12-hour window due to a large backlog of pending transactions, raising concerns about the platform's ability to handle such surges in the future.
On May 5th, the news broke that authorities in Israel seized 190 Binance accounts linked to terrorist organizations.
