The crypto market is buzzing, and it appears, at some point, Binance, which is the largest ramp by adjusted trading volumes, couldn’t keep up with high traffic.
Binance Order Book Delays
According to a notification from Changpeng Zhao, the CEO of the expansive exchange, certain parts of their system were struggling to keep up with high traffic.
It also seems that the exchange has been improving their systems on the back end since CZ said “not all parts of the system has been live tested under this load.”
Specifically, BINANCE had delays in their order books. However, not all pairs were affected.
“Parts of the system are still struggling to keep up with the high traffic. Given so many updates per day, not all parts of the system have been live tested under this load. I guess the good news is: there is very high SUSTAINED demand. Working on it, all hands on deck.”
Parts of the system are still struggling to keep up with the high traffic. Given so many updates per day, not all parts of the system has been live tested under this load.
I guess the good news is: there is very high SUSTAINED demand.
Working on it, all hands on deck. ??????
— CZ Binance ?????? (@cz_binance) February 13, 2020
“There is a slight delay in the order book display across some trading pairs. Team are working on it. Funds are SAFU.”
There is a slight delay in the order book display across some trading pairs. Team are working on it. Funds are #SAFU.
— CZ Binance ?????? (@cz_binance) February 13, 2020
The problem has since been fixed, and the exchange performing as usual. All user funds are safe, and there has been no compromise of any form.
Fixed. Apologies for the inconvenience. https://t.co/OgSkVjTij6
— CZ Binance ?????? (@cz_binance) February 13, 2020
Caution from Binance Traders
Given the spate of attacks that have resulted in a loss of billions of dollars. The trading community remains apprehensive and spot such hitches. Centralized exchanges like Binance are custodial.
This means, though the user can deposit, trade, and withdraw coins, ownership is under the exchange.
Whenever coins are deposited in any of these custodial wallets, the end user has no control.
Since the client lacks control, losses, which can be steep, is borne by the end user especially when mitigating solutions like insurance lacks.
Lessons from Quadriga CX
Last year, crypto traders lost more than $170 million worth of Bitcoin and assorted cryptocurrencies when the owner of the Canada-based ramp Quadriga CX unexpectedly died in India.
Investigations revealed that Gerald Cotten, the owner, had not divulged the keys of the coins held in the exchange’s cold wallet before his mysterious death.
“The most likely scenario is that he was a con artist who got in way over his head and fucked up and got desperate and panicky made some terrible decisions… and died in India.”
— Nathaniel Rich pic.twitter.com/fEo1rt39Py
— Peter McCormack (@PeterMcCormack) December 17, 2019
Users are still pressing for proof of his death but coins, as the situation is, would be hard to recover unless there are intervention.
I can't wait till the market figures out that Bitfinex/Tether have been pulling much of the same shit Gerald Cotten pulled at Quadriga, except on a WAY bigger scale.
— FlipTheCrypt (@MoarCryptoz) June 21, 2019
Binance has its insurance fund. When it was hacked in May 2019, victims were compensated.
