UPDATE (July 4, 8:07 UTC): Binance said that it resumed trading at 8:00 UTC on July 4 and will release a “more in-depth explanation of today’s maintenance in a later announcement.”
UPDATE 2 (July 4, 9:23 UTC): Binance confirmed the system maintenance was due to irregular trades of the SYS cryptocurrency and has released an incident recap.
Binance, the world’s largest cryptocurrency exchange by trading volume, suspended trading services on Wednesday after irregular transactions were reported on its platform.
Syscoin, a distributed network based on a fork of the bitcoin protocol, said on Twitter around 21:00 UTC on Tuesday that it noticed a potential issue and subsequently asked exchanges to suspend the trading of its SYS cryptocurrency.
The project later confirmed after an investigation that it discovered “odd trading behavior coupled with atypical blockchain activity.”
Though Syscoin has not yet disclosed details from its investigation, the issue appeared to have resulted in unusual transactions on Binance’s SYS order books, which accounted for over 87 percent of the cryptocurrency’s total trading volume, data shows.
The 24-hour price high data from Binance indicates that at one point one SYS was worth 96 BTC while its price had previously maintained around 0.00004 BTC. Yet it is unclear how many SYS tokens might have been executed at the unusual price.
Syscoin co-founder Sebastien DiMichele told CoinDesk:
“My understanding is that yes, Syscoin was sold for 96 BTC per unit at one point today. We saw massive bot activity, our community let us know that they were having trouble with deposits at Binance.”
Three hours after Syscoin’s Tweet, Binance said in a blog post that it has halted the platform’s all trading services as it will “undergo system maintenance,” during which “trading, withdrawals and other account functions will be suspended.”
While Binance initially didn’t specify whether the overall halt directly resulted from Syscoin’s reported blockchain issue, the exchange indicated in a follow-up post that the system maintenance is due to some” irregular trading” on the platform.
“Due to irregular trading on some APIs, Binance will remove all existing API keys as a precautionary security measure. All API users are requested to recreate their API keys,” Binance wrote. The company has not responded to CoinDesk’s request for further comment.
Following the event, the price of Syscoin surged by around 100 percent to nearly $0.50, which was followed by a rapid decline to around $0.28, according to price data from CoinMarketCap.
Editor’s Note: This article has been updated with new information.
Binance image via Shutterstock