Binance Is Halting ETH Deposits and Withdrawals Until the Merge Done
Binance stated in an announcement made on September 5th that it would suspend Ethereum wallet on several networks pending the “Merge.” The tokens affected include ETH and WETH.
The company explained that the decision was made to protect tokens in the event of a chain split.
Why does Binance suspend ETH deposits and withdrawals before the Merge done?
With the long-awaited merge quickly approaching, various crypto platforms are taking steps to ensure that the transition completes as smoothly as possible. Earlier today, FTX made a similar announcement to that of Binance.
Both FTX and Binance explained that the suspension of ETH deposits and withdrawals would be carried out to ensure a smooth transition and protect users against possible losses. Trading of Ethereum will not be affected by the suspension on either platform.
Binance clarified that the affected tokens are ETH on the Arbitum and Optimism networks and WETH on the Ronin network. The suspension will start on September 6th—Tuesday—and will last until all the networks are deemed stable after the Merge.
Binance also explained that in case of any discrepancies between the English and non-English versions arise, the English one will be taken as valid. Any deposits made before the merge is complete, and after the 6th will not be credited.
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What is Ethereum Merge?
Ethereum Merge is possibly the biggest crypto event of 2022. It has been postponed multiple times, and thousands of dApps have been preparing for it since the Spring. The Merge will effectively sever ETH’s reliance on miners as it will transition the token from a proof-of-work model (PoW) to a proof-of-stake one (PoS).
This transition is expected to reduce ETH’s energy consumption by around 99% and has already seen gas prices plummet following the successful Goerli test in August. This major event is still subject to some uncertainty though.
Ethereum miners have announced that they will try to split the chain to maintain their PoW business model. In addition, the Merge has not yet been priced and it is not entirely clear what effect this will have on the value of the world’s second largest cryptocurrency. While most believe the effects will be positive, many still warn that Ether’s gains may be overstated ahead of a major event.