Ethereum Deposits Reopen on Binance After Short Freeze

Binance locked its wallets temporarily on Friday due to problems with Ethereum (ETH) and ERC-20 token deposits. The exact nature of the glitch, which took a few hours to fix, has not been explained, but the deposit function is now active.

Technical Issues and Resolution

In a Reddit thread, Binance announced it was working on a “known issue” and deposits would reopen in a few hours. Wallets were locked for coins affected by technical problems in the past, but this was the first time for Ethereum. Binance has previously experienced problems with the Bytecoin wallet and has delisted the coin.

Users reported the issue was not with the Ethereum network, where transactions remained successful but not reflected within the user balance.

The exchange wallet freeze did not affect trading or influence Ethereum prices directly. Following the news, ETH traded at $203.95, marking a small, unexpected increase. The Ethereum network has seen normal amounts of load, with most gas-consuming apps recording much lower usage.

Token Vulnerabilities and Exchange Activity

Tokens, however, are a slightly different matter as those types of assets are much more vulnerable to errors or scams, especially if smart contracts are involved.

Binance has always been under scrutiny for its wallet activity since even transfers between cold wallets raise suspicions. Recently, a large transaction of ETH to a new address attracted attention:

https://twitter.com/Countergrind/status/1054034422809403392

Commenters on Etherscan suggested the transaction may be a movement of funds to the exchange’s new cold wallet, especially given the conspicuous sum of 888,888 ETH.

Recently, Binance also moved around 38,000 Bitcoin from one of its cold wallets.

The exchange lists multiple ERC-20 tokens, including the native Binance Coin (BNB), as well as projects of various prominence, among them Basic Attention (BAT) and stablecoins using the ERC-20 standard.

For additional context, see Binance's official announcement on Twitter: https://twitter.com/binance/status/1055688596298981377