Crypto Stocks Fall After Binance Halts Bitcoin Withdrawals for Hours

Cam White | May 8, 2023

Responsive image

(Reuters) – Shares of crypto currency- and blockchain-related companies fell in premarket trading on Monday after Binance halted its bitcoin withdrawals for several hours due to heavy volumes and rising processing fees.

The halts pushed bitcoin, the world’s biggest cryptocurrency, down 2% to a one-week low of $27,900.

Crypto exchange Coinbase Inc fell 4%, while blockchain-farm operator Bitfarms Ltd dropped 4.3%. Crypto miners including Riot Platforms, Marathon Digital and Hut 8 Mining declined between 4.6% and 7.2%, tracking lower bitcoin prices.

Binance, the world’s largest crypto exchange, shut bitcoin withdrawals for an hour late on Sunday and for about three hours on Monday, saying there was a glut of pending transactions because it hadn’t offered so-called miners a high enough reward to log the trades on the blockchain.

The company said its set fees did not anticipate the recent surge in bitcoin-network gas fees – the payments made to crypto miners whose computing power processes transactions on the blockchain.

“To prevent a similar recurrence … our fees have been adjusted,” Binance had said.

In March, the company suspended deposits and withdrawals citing tech issues.

(Reporting by Jaiveer Singh Shekhawat in Bengaluru; Editing by Devika Syamnath)