Binance, the world’s largest cryptocurrency exchange by trading volume, has suspended its trading services, hours after one token on its platform was reported with irregular transactions.
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 with its system and subsequently asked exchanges to suspend the trading of its SYS token. The project later confirmed after an investigation that it has 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 of SYS on Binance, which accounted for over 87 percent of the token’s total trading volume, data shows.
The 24-hour price high data from Binance indicates that at one point the price of SYS per unit against bitcoin (BTC) shot up to 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.
In a response to CoinDesk’s enquiry, Syscoin’s co-founder Sebastien DiMichele said:
“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.”
Hours after Syscoin’s announcement, 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 didn’t specify whether the overall halt is 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. Yet the company has not responded to CoinDesk’s request for further comment.
Following the event, the price of Syscoin had surged by around 100 percent to nearly $0.5, which was followed by a rapid decline to just around $0.28 according to price data from CoinMarektCap.
Binance image via Shutterstock