Binance Suspends Ethereum and ERC-20 Token Withdrawals Before Quickly Reversing Course

The rollercoaster-ride in cryptocurrency prices on Monday was accompanied by Binance’s fresh restrictions for ethereum and ERC-20 tokens.

Ethereum Network Congestion Fingered as the Culprit for the Temporary Halt

Through the official Binance Twitter account, one of the world’s largest cryptocurrency exchanges by volume, announced that it had “temporarily suspended withdrawals of $ETH and ethereum-based tokens” due to network congestion while underscoring that user funds were SAFU (Secure Asset Fund for Users).

#Binance has temporarily suspended withdrawals of $ETH and Ethereum-based tokens due to high network congestion.

Rest assured funds are #SAFU and we apologize for any inconvenience caused.

Updates to follow.

— Binance (@binance) February 22, 2021

Although Binance has since reversed its earlier decision and restored service in an announcement 37 minutes after its first tweet, traders were quick to pile on with the criticism. This latest move came amid a spike in Ethereum gas costs and a backlog that quickly escalated past 151,000 pending transactions. Binance CEO Changpeng Zhao corroborated the stress on the system, noting that gas shot past “+1200” during the latest congestion.

ETH is super congested now, at 1200+ gas. @Binance have suspended withdrawals.

There was a conspiracy theory that Binance is deliberately making ETH gas fees high.