Record Volume & ‘Insane’ Traffic Is Breaking Top Cryptocurrency Exchanges
Exchanges continue to grapple with scaling and connectivity issues as volume hits new ATHs every day in tandem with the price of digital assets.
Bitcoin’s historic gains are resulting in constant issues at cryptocurrency exchanges.
On Thursday, Bitcoin surpassed $40,000 and then provided a buy the dip opportunity with its drop to $36,550, but people couldn’t take advantage of it because they couldn't access the platforms. Today, BTC topped $41,960.
“We're aware of and investigating connectivity issues on Coinbase and Coinbase Pro on both web and mobile apps. We're working quickly to restore service back to normal,” noted the San Francisco-based exchange, which filed for an IPO with the SEC last month with a ponytail valuation of $28 billion.
This isn't even the first time the crypto community has long been complaining, before even the 2017 bull run, about this with no solution at all.
Insane amount of traffic.
— CZ 🔶 Binance (@cz_binance) January 8, 2021
These disruptions at crypto exchanges result from rapid price increases that are bringing more and more traffic to them. When BTC broke the $10k milestone in June, Coinbase experienced a fivefold increase in traffic over four minutes.
Coinbase traffic has increased from 23.73 million in October to 47.97 million in December, as per Similar Web. During the same time, Binance’s traffic surged from 32.5 million to 56.27 million.
The volume across exchanges have also reached new records.
“Binance is experiencing ATH volumes. Users may experience some delays due to extreme market volatility,” tweeted the exchange on Friday.
Bitcoin volumes across exchanges has just doubled it's previous all time highest level. pic.twitter.com/Hl5T4N4Sck
— Mati Greenspan (tweets ≠ financial advice) (@MatiGreenspan) January 7, 2021
Coinbase, meanwhile, has been seeing a lot of institutional interest. Throughout 2020, Coinbase, among most other exchanges, experienced large outflows of bitcoin, which lately accelerated heavily and has been connected to institutional buying.
Coinbase was the primary execution partner to initiate MicroStrategy’s purchase of Bitcoin. This week, the exchange shared it also assisted One River Asset Management as a full service-partner and custodian.
Trader Scott Melker called these massive outflows “insanely bullish” as “huge buys moved off of exchange, with no intent to sell.”