Key Points:
- Binance’s wallet move caused Ethereum gas fees to spike by 1,900%.
- The exchange explained it was a “routine consolidation” of assets.
- The incident intensified scrutiny amid SEC lawsuits against Binance.
A sudden surge of transactions originating from a wallet linked to the prominent cryptocurrency exchange, Binance, has inadvertently caused Ethereum ($ETH) transaction fees to skyrocket by an astonishing 1,900%. This surge occurred as the wallet moved more than $840,000 worth of ETH within a mere 24-hour timeframe.
Etherscan, a well-known Ethereum blockchain explorer, documented that a wallet named “Binance 14” received ETH from wallets that had remained inactive for nearly three years. This sudden influx of transactions resulted in Ethereum’s transaction fees spiking, as ETH users found themselves needing to pay considerably more to expedite their transactions due to limited block space.
🔥 Gas Fees Alert! 🔥
Binance’s crypto wallet, “Binance 14,” spent a whopping $843,797 in ETH gas fees within 24 hours! 😱
Community reactions are pouring in, with some questioning Binance’s tech capabilities and gas settings.
Binance explained it was aggregating wallets… pic.twitter.com/KNdsoZSZch
— BuzzBeatHQ 🚀 (@mely_buzz) September 21, 2023
Binance responded to users’ concerns on social media by explaining that these transactions were part of a routine consolidation of their assets into a specific wallet. They acknowledged the surging transaction fees, dismissing them as an unintended but swiftly resolved consequence of their transactions.
Many in the cryptocurrency community questioned the decision to execute these transactions in bulk, a move that unquestionably led to network congestion and higher fees compared to what the exchange would have incurred with better timing.
This incident propelled the Binance 14 wallet into the top 50 contributors to gas fees, intensifying the ongoing debate and skepticism surrounding Binance’s operations. This scrutiny comes in the wake of lawsuits filed by the U.S. Securities and Exchange Commission (SEC) against Binance, accusing the company of violating securities laws.
Notably, these transactions occurred shortly after a participant in an Ethereum initial coin offering (ICO) moved a substantial 6,000 ETH, valued at nearly $10 million, to the popular cryptocurrency trading platform, Kraken. This move could potentially lead to a significant sale of tokens in the market.
Data from the Ethereum blockchain reveals that this massive whale transaction incurred only approximately $2.8 in transaction fees. While the transaction might suggest that a substantial entity is cashing out, it’s important to note that the whale’s wallet still holds 49,000 ETH, amounting to nearly $80 million.”
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