Home News Binance temporarily suspends LUNA, UST withdrawals citing network congestion

Binance temporarily suspends LUNA, UST withdrawals citing network congestion

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Binance

On Tuesday, leading crypto exchange Binance briefly banned withdrawals for LUNA and UST as the crypto community continues to try to figure out Terra’s continuing pegging-de-pegging crisis in regard to its stablecoin TerraUSD (UST).

As LUNA’s price plummeted sharply due to a large selloff, the market value of UST, Terra’s stablecoin, went below the predicted $1.00 price point. As reported, the BTC/UST trading pair on the leading crypto exchange reached highs of almost $42,000, while other Bitcoin dollar marketplaces battled to keep $30,000.

The leading crypto exchange temporarily halted all withdrawals for LUNA and UST tokens, citing a high volume of outstanding withdrawal transactions, as a reaction to the growing uncertainty in the Terra ecosystem.

The huge volume of pending UST transactions, according to the leading crypto exchange, is due to network slowness and congestion, stating:

“Once we determine that the network is stable and the volume of pending withdrawals has decreased, the exchange will reopen withdrawals for these tokens. In a subsequent announcement, we will not alert users.”

Crypto However, Twitter users reacted to Binance’s news by questioning the crypto community’s intrinsic ideals of decentralisation, equating the move to traditional finance’s centralised approach.

The suspension of Binance’s funds is one of the fundamental drawbacks

As customers throughout the world are unable to withdraw their own assets, the community has reaffirmed the term “not your keys, not your coins,” and cited the suspension of the leading crypto exchange’s funds as one of the fundamental drawbacks of a centralised crypto exchange.

Some members of the community, on the other hand, defended the decision, claiming that the leading crypto exchange CEO Changpeng “CZ” Zhao saved many investors from liquidation by selling a stablecoin at $0.70.

Several crypto entrepreneurs, including Polygon co-founder Sandeep Nailwal, have expressed support for Do Kwon, the co-founder and CEO of Terraform Labs.

After Tether (USDT) and USD Coin (USDC), UST flipped the leading crypto exchange USD (BUSD) to become the market’s third-largest stablecoin on April 18.

Source: CoinGecko

However, because of the recent turmoil in the Terra ecosystem, BUSD has regained its place as the 9th most valuable cryptocurrency by market capitalization. UST is now ranked 10th on the list, with a market capitalization of approximately $16.5 billion.

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