A number of Binance users cried out in frustration yesterday after severe lags on Binance’s trading platform caused some of them to lose thousands of dollars in crypto. At the same time, the exchange’s CEO, Changpeng Zhao, confirmed that the lag was an issue and promised that Binance was working to fix it.
Zhao live-tweeted the discovery and the updates on fixing the issue, saying that the problem was caused by heavy trading volume. “Much heavier load than even peak of 2017. Good problem to have,” he wrote at one point–not the first time that Zhao has stuck his foot in his mouth on Twitter.
Good for Who?
“Good for you, perhaps. Bad for those of us who were unable to place/cancel orders and were stuck with risk on, unable to trade during this stretch,” wrote Twitter user @Crypt0poly in reply.
Another user expressed concerns over what might happen if Bitcoin surpasses its former price records: “hopefully this doesn’t occur when $btc is above 30k…could be an even bigger issue,” @Yo_Dez said.
Indeed, the losses occurred because traders suddenly found themselves unable to exit trades that they would have canceled if the platform had been functioning correctly. At least five users reported losses in the thousands on Twitter.
I lost almost 3 btc
— seanray (@seanray_7) May 22, 2019
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According to Zhao, the problem did not affect API users, which largely consist of trading bots and software. Traders who manually enter their trades into the platform were the ones who bore the brunt of the problem.
After several hours had passed, Zhao tweeted that the platform had returned to normal, although there was a backlog of transactions to be processed.
order new/cancel should be restored now. Historic orders may still take further time to fully sync up. Some deposits may be missing, but will be sync’ed shortly. Found an issue with a logging service under load. Will address accordingly. https://t.co/5a274tfmc9
— CZ Binance (@cz_binance) May 22, 2019
While the lags seem to have been an annoyance more than a major issue for most Binance users, the incident comes just weeks after Binance was hacked for 7000 BTC.
Previous to the hack, Binance was renowned as one of the most secure exchanges in the industry; its security and user-friendliness also made Binance one of the most profitable crypto exchanges on the planet.
Now, users may be a little more cautious about using the platform–time will tell exactly how much financial damage Binance’s technical issues will do to the exchange in the long term.