May 8 (Portal) – Shares of cryptocurrency and blockchain-related companies fell in early trading on Monday after Binance halted its bitcoin withdrawals for several hours amid high volumes and rising processing fees.
The disruptions pushed Bitcoin, the world’s largest cryptocurrency, down 2% to a one-week low of $27,900.
Crypto exchange Coinbase Inc (COIN.O) fell 3.6%, while blockchain farmer Bitfarms Ltd plunged 5.1%. Crypto miners such as Riot Platforms (RIOT.O), Marathon Digital (MARA.O) and US-listed Hut 8 Mining (HUT.TO) fell between 5.3% and 6.6%, trailing the lower bitcoin prices.
Binance, the world’s largest crypto exchange, shut down bitcoin withdrawals an hour late on Sunday and about three hours on Monday, saying there was an abundance of pending transactions for failing to offer so-called miners a high enough reward have to log them in trading on the blockchain.
The company said its set fees did not anticipate a recent spike in gas fees for bitcoin networks – payments to crypto miners, whose computing power processes transactions on the blockchain.
“There was so much traffic congestion and also the gas prices were so high over the weekend… even by historical standards,” Oppenheimer’s Owen Lau told Portal.
Binance said in a tweet that the company adjusted its fees to “prevent a similar recurrence.”
In March it had suspended deposits and withdrawals citing technical issues.
Reporting by Jaiveer Singh Shekhawat in Bengaluru; Editing by Devika Syamnath
Our standards: The Trust Principles.