Bitcoin Stabilises Following Binance-Driven Sell Off
Binance Issues Impact BTC
Bitcoin prices have stabilised over early European trading on Tuesday following heavy price falls in recent sessions. The selling comes in response to news that Binance, the largest crypto exchange, was seen temporarily freezing Bitcoin withdrawals twice over the weekend. The action was taken in response to heavy volumes and surging transaction fees which caused a lot of congestion in the market.
Unlike with other crypto brokers who recently collapsed, the pause is reputedly not due to liquidity issues around processing the withdrawals. Instead, Binance said the issue was caused because its set fees offered to miners on its blockchain network were not high enough causing a breakdown in its processes.
High Gas Fees
So-called gas fees (fees paid to crypto miners logging trades on the Bitcoin blockchain) were seen soaring over the weekend hitting their highest levels since Bitcoin was at $60k. Binance said that it has now made adjustments to pending withdrawals which should prevent similar episodes. However, the sell off in BTC suggests that there is maybe some concern over Binance’s liquidity despite its explanations.
Technical Views
BTC
The correction lower from the current YTD highs above 30000 has seen the market consolidating in a contracting triangle pattern. For now, the market is broadly underpinned by support around the 28110 level, keeping the focus on an eventual move higher from the current range. However, should we break lower here 24930 is the next support to note.
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