Crypto stocks fall after Binance halts Bitcoin withdrawals for hours
In premarket trading on Monday, shares of companies related to cryptocurrency and blockchain experienced a decline due to Binance temporarily halting its bitcoin withdrawals.
The halt was caused by heavy volumes and rising processing fees. As a result of the halts, the value of Bitcoin, the world's largest cryptocurrency, fell by 2% to reach a one-week low of $27,900. Shares of Coinbase Inc (COIN.O) fell by 4%, while blockchain-farm operator Bitfarms Ltd experienced a decline of 4.3%.
Crypto miners, such as Riot Platforms (RIOT.O), Marathon Digital (MARA.O), and Hut 8 Mining (HUT.TO), dropped between 4.6% and 7.2% in response to the lower bitcoin prices.
Binance, which is the largest crypto exchange in the world, shut down Bitcoin withdrawals for an hour on Sunday and for about three hours on Monday.
The company stated that there was a backlog of pending transactions due to not having offered miners a high enough reward to log the trades on the blockchain.
Binance explained that 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 occurrence, Binance announced that it had adjusted its fees.
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