Binance Was Overloaded With Demand Amid Dogecoin Frenzy

Binance was overloaded with demand amid the dogecoin frenzy as the CEO Changpeng Zhao said that the exchange almost ran out of Dogecoin deposit addresses, so let’s read more in our latest Binance news.

Binance saw exponential growth In use traffic after the spike in the price of Dogecoin. CZ said that Elon Musk and his decision to put “Bitcoin” in his Twitter bio may have helped things as well. Doge started out as a joke but it saw huge increases in trading volume especially in the past 24hours. Zhao commented that the recent load issues to some combination of Elon Musk, Dogecoin, and the chaos surrounding the Gamestop GME rally. The world’s cryptocurrency exchange was forced to suspend withdrawals earlier today, responding to what Zhao referred to as “system load issues.”

Zhao said that Binance was overloaded because of exponential growth in user traffic, trading volumes, and deposits and withdrawals volumes across the board. Zhao suggested that Elon Musk changes his Twitter Bio to “Bitcoin” which could have contributed to the traffic uptick. Musk saw the endorsement of the coin was widely attributed as the reason that the price of BTC increased by 15% and squeeze out the short-sellers to $450 million. the morning after came a period of uncertainty in the traditional markets as the subreddit r/walletstreetbets sent the price of the GME stocks to new highs and created a short-squeeze that cost the hedge funds billions. Zhao continued:

“It’s impossible, for us or anyone, to assign a specific cause to some result in a free market. We can’t say for certain that Elon’s Twitter bio change caused sudden price movements in Bitcoin, which led to a massive traffic spike to Binance, which then overloaded parts of our systems, and caused some withdrawal delays.”

He added:

“It could have been Elon’s Twitter bio change; It could have been WallStreetBets; It could have been some whales in Asia or Uganda, or 1,000 other potential reasons. There is no way to be 100% sure. It’s all likely, but who knows.
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On the other hand, Dogecoin saw huge gains over the past day, despite starting out as a “meme coin” designed to poke fun at the BTC knockoffs that emerged on the market but the recent price increase is still very real. Zhao noted:

 “We actually almost ran out of Dogecoin deposit addresses because the new address generator wasn’t able to generate new addresses for user deposits fast enough to match user deposits.  On the withdrawal side, our normal number of nodes can’t process the amount of withdrawals that’s happening either, we had to significantly increase the number of nodes in a short period of time. Whenever there are [sic] exponential growth, there are high chances of congestion.”