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Binance US temporarily halts USDC withdrawals on Ethereum chain due to inventory coverage problem

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On February 15, according to the Binance US status report, Binance US suspended the withdrawal of USDC on the Ethereum chain at 5:19 on February 15, because th…

Binance US temporarily halts USDC withdrawals on Ethereum chain due to inventory coverage problem

On February 15, according to the Binance US status report, Binance US suspended the withdrawal of USDC on the Ethereum chain at 5:19 on February 15, because the concentration of USDC on the ETH network was temporarily insufficient. Binance US said at 10:41 on February 15 that the inventory coverage problem of USDC had been solved, and the deposit and withdrawal of USDC were now available, with a suspension time of more than 5 hours.

Binance US has resumed the withdrawal of USDC on the Ethereum chain

Interpret the above information:


Binance US is a popular cryptocurrency exchange in the United States, which provides a platform for users to trade and store digital assets. One of the most commonly traded cryptocurrencies on Binance US is USDC, a stablecoin that is pegged to the US dollar. On February 15, Binance US experienced an interruption in the withdrawal of USDC on the Ethereum chain.

According to the Binance US status report, the withdrawal of USDC on the Ethereum chain was suspended at 5:19 am on February 15, due to the concentration of USDC on the network being temporarily insufficient. This means that there was a shortage of USDC available for withdrawal requests. As a result, users were unable to withdraw their USDC holdings from the exchange.

Binance US provided an update at 10:41 am on February 15, stating that the inventory coverage problem of USDC had been solved, and the deposit and withdrawal of USDC were now available again. The suspension time lasted for more than 5 hours, causing inconvenience and frustration for users who were unable to access their funds during this period.

The inventory coverage problem refers to the amount of USDC available to meet the demand for withdrawals on the Ethereum chain. Stablecoins like USDC are designed to maintain a stable value relative to the US dollar. To achieve this stability, issuers of stablecoins must hold sufficient reserves of USD to back up the circulating supply of stablecoins. When the inventory coverage is insufficient, it means that the issuer does not have enough USD reserves to support the amount of stablecoins in circulation. This can cause stability issues and impact the ability of users to access and withdraw their holdings.

In conclusion, Binance US experienced a temporary interruption in the withdrawal of USDC on the Ethereum chain, due to an inventory coverage problem. The issue was resolved after more than 5 hours, but it caused inconvenience and frustration for users during this period. This incident highlights the importance of sufficient inventory coverage for stablecoins, and the impact it can have on the accessibility of digital assets.

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