The pain of trading in popular exchanges. Binance frooze during the BTC spike

[logfiles]

I used to think the stories of exchanges freezing were just myths until I experienced it with Bitmex sometime back and that was the last time I used it. Today, I was a victim again of this kind of freezing but this time round with Binance.

Shortly after the price had started spiking, I had some USDT in there that I wanted to convert to ETH or BTC to avoid missing the rally past $20K but logging into the Binance website wasn't even possible.

 

I made a beeline for my mobile phone since the app is already logged into my account but everything was messed up there as well. I even tried the margin trading part, nothing was working.

- The order book would delay to load and once it loaded the price range displayed was totally different from the market price
- Placing an order was impossible, Network Request Failed kept on appearing on the screen
- My wallet overview was totally blank, no total asset value displayed. All withdraw, Deposit and Transfer buttons now working

 

At the same time I loaded the app of the other less popular exchange I use (bybit) and It was working well which means there was nothing wrong with my internet connection.

I later managed to log in, buy the assets and withdraw them after the bitcoin price has settled a bit

Conclusion
1.  Avoid trading on popular or Big exchanges during times of volatility. You could easily get into trouble of making losses or getting liquidated because you can't close your position

[figmentofmyass]

Avoid trading on popular or Big exchanges during times of volatility. You could easily get into trouble of making losses or getting liquidated because you can't close your position

it's a catch-22. the high volume exchanges like binance, coinbase, bitmex, etc are prone to outages during peak volatility. however, using a small exchange isn't an adequate substitute because there won't necessarily be enough market depth to get in or out.

i guess holding 2nd layer assets like lightning BTC or liquid sidechain BTC/USDT could be useful for this. you could instantly transfer assets to an exchange that is operating normally, who should be able to credit them ~immediately.

kraken is adding support for lightning this year. hopefully others follow suit! https://blog.kraken.com/post/7225/a-need-for-speed-kraken-to-launch-bitcoin-lightning-%E2%9A%A1%EF%B8%8F-integration-in-2021/

[Darker45]

The same problem I had last night with Binance. I repeatedly tried to log in but to no avail every time. I ended up putting off my business and waited for today. Everything's done now. It was somehow a blessing in disguise as Bitcoin gained around a thousand dollars since then. It is now hitting $22,000.

But the downside is that Binance is now charging 0.0005BTC withdrawal fee. That's around $11. Oh so high!

[nasipadang]

What could be the reason of this instances? was it because of the number of users using the exchange site? I wasn't able to experience this one luckily I managed to withdraw all my coins to hardware wallet and choose to hold it for a long time well I'll keep this in mind thank you for sharing.

[Findingnemo]

Better avoid trading at the time of spike on any exchanges because choosing the exchanges with less volume also may get us into lot of trouble and also our trading experience will be really bad if something went wrong on such exchanges compared to the popular exchange because of trust/reputational issues.

And also we should be keen when making transactions now because the mempool size is over 100Mb which resulted into unpredictable spike in the fee as well so find the right amount of fee required before initiating transaction by analyzing the mempool by yourself because most of the wallets are giving wrong calculations now.

[hugeblack]

I see that it is laziness from these platforms, so instead of spending more money to ensure availability and access to the site 99.999% of the time, they are interested in listing more currencies and manipulating prices.

I do not know if these sites have imposed restrictions on withdrawals, but hot wallets will be affected, especially currencies like USDT and the difficulty in withdrawing them.

Stablecoins contributed to reducing the demand for withdrawal, otherwise, the site would not work until today and may lead to significant price manipulation.

[Darker45]

What could be the reason of this instances? was it because of the number of users using the exchange site? I wasn't able to experience this one luckily I managed to withdraw all my coins to hardware wallet and choose to hold it for a long time well I'll keep this in mind thank you for sharing.

Here's from CZ himself:



There must have been a huge spike in the demand that even CZ had not foreseen it himself. They really need to address this scaling issues quickly. Bitcoin is gaining so much momentum now; they can't be the reason why people would be discouraged to get into Bitcoin or trading.

Better avoid trading at the time of spike on any exchanges...

It's just that a spike calls for urgent trade actions.

This is the reason why a lot are angered by the sudden trading freeze in Binance. Shorters failed to close their positions.

[sunsilk]

It was the same exchange that had from problem for withdrawal through this thread, 2 days ago: Impossible to withdraw from Binance. The overwhelming demand can't be catered by their server and they really have to improve their facility in case another spike comes.

They should have thought of this even before a bull run comes and they should learn from other exchanges that have faced problems during times like this. No matter what issue we experience with them, they know that we're going back to them again once they've fixed the issues. I know that they can do better this time and won't allow these issues to happen again.

[logfiles]

Isn't it a huge pain?

You want to make some quick profits on that popular exchange you feel safe to trade on due to Bitcoin price spikes but all of a sudden, everything implodes, You can log in, if already logged in; You can view your correct account balances, you can enter or exit positions, you can't see the fuckin' orderbook, you can't even make any withdrawals,

Is it still wrong to avoid this huge exchanges during times when coin prices go crazy?
I bet some members now agree with me

1. Binance is showing Zero Balance
2. Binance has temporarily suspended withdrawals of ETH and Ethereum-based tokens
3. What to do right now with Binance? It's terrible

[hugeblack]

Isn't it a huge pain?

You want to make some quick profits on that popular exchange you feel safe to trade on due to Bitcoin price spikes but all of a sudden, everything implodes, You can log in, if already logged in; You can view your correct account balances, you can enter or exit positions, you can't see the fuckin' orderbook, you can't even make any withdrawals,

This is the benefit of Bitcoin, which is that you can use it without having to wait for the central networks to use.
Tx fees will be at their ATH and many exchange servers will be slow because they aim for profit first, and then benefit users. they may slow them servers for manipulation.
You can use centralized Bisq or HodlHodl but believe me, it seems that the price will continue to rise, so even if you are late, you may not miss the opportunity.

Binance also try to show that they have fast Binance smart chain network.

Generally, they have made a lot of profits and they should pay more to improve services.

[Darker45]

Isn't it a huge pain?

You want to make some quick profits on that popular exchange you feel safe to trade on due to Bitcoin price spikes but all of a sudden, everything implodes, You can log in, if already logged in; You can view your correct account balances, you can enter or exit positions, you can't see the fuckin' orderbook, you can't even make any withdrawals,

Is it still wrong to avoid this huge exchanges during times when coin prices go crazy?
I bet some members now agree with me

1. Binance is showing Zero Balance
2. Binance has temporarily suspended withdrawals of ETH and Ethereum-based tokens
3. What to do right now with Binance? It's terrible

As much as we want to avoid this huge exchange, it seems it is still one of the safest we can turn to during these bull days.

But I agree that sometimes the one you rely on the most is indeed a huge pain in the ass. And with all your disappointment, frustration, and head-shaking, the owner will just tell you that "we don't like in a perfect world." LOL. What a joke!