Binance went down temporarily owing to high trading activity on the platform as Bitcoin price touched a new all-time high. Bitcoin price rallied in the wake of Tesla’s $1.5 billion bitcoin purchase hitting a new all-time high of $42,900 after spending more than a month under $35,000.
We are aware of some temporary difficulties accessing https://t.co/QILSkzx7ac.
Rest assured our team is working on it.
Thank you for your patience and apologies for any inconvenience caused.
— Binance (@binance) February 8, 2021
Crypto exchanges going down during peak trading hours has become a trend of the sort this bull season. While Coinbase used to be the first exchange to experience an outage on most occasions, Binance seems to be quickly catching up. The technical faults of these exchanges have also raised concerns over many crypto companies’ public debut this year including Coinbase.
Crypto Exchanges Frequent Outages Lead to Heavy Losses
The inability of crypto exchanges to handle heavy trading traffic during peak trading hours had led to heavy losses to traders with open market positions. Many traders with high leverage positions were liquidated as they could not close their position in time.
Imagine making so much money through fees and crashing everytime when you need it most. Thanks Binance..
— CoinMamba (@coinmamba) February 8, 2021
Many even asked CZ, the CEO of Binance to compensate users for their losses. The frequent outages combined with traders losing billions in liquidated positions have also raised questions about whether the crypto ecosystem is ready to handle mainstream trade volumes and traffic.
— WALLSTREETBETS (@chairmanDex) February 8, 2021
The recent price surge of bitcoin came after Tesla’s SEC filing to purchase $1.5 billion in bitcoin surfaced soaring bitcoin price from just under $40,000 to over $44,000 in mere 15 minutes. The sudden price surge led to heavy traffic on mainstream exchanges like Binance leading to technical issues thus bearing exchange accesses to customers.
Coinbase and Binance both have recorded all-time-high spot trading volumes worth $9.5 billion and $8 billion during the last price surge at the start of January. However, despite being aware of technical limitations during peak trading hours, these exchanges haven’t made necessary changes to accommodate for the rising traffic.