April 19, 2024
Ethereum Gas Prices Surge as Binance's 'Routine' Account Consolidation Sparks Controversy
Altcoins News

Ethereum Gas Prices Surge as Binance’s ‘Routine’ Account Consolidation Sparks Controversy

Gas prices on Ethereum skyrocketed as a result of a “routine” Binance account consolidation process, raising questions about competency on Thursday.

Hundreds of inbound ether transactions were sent to an address called Binance 14 at around six in the morning ET. According to Etherscan, the procedure increased gas prices by up to 280 gwei, which is more than 20 times the current price of 13 gwei.

The wallet was accountable for 83% of fees at the height of the transfers, briefly making the address one of Ethereum’s biggest gas consumers. The decentralized exchange Uniswap, numerous MEV bots, and layer-2 networks that settle transactions to the base chain are typically the top spenders.

The Binance 14 address has only used $562 in the previous three hours, out of a total of $842,000 in gas fees during the past 24 hours. The address has consumed $95 million in gas during the duration of its life between incoming and outgoing transfers and presently represents $250 million of Binance’s over $56 billion in assets.

A Binance spokesperson confirmed, “Binance carried out a routine consolidation of [ether] ETH to one of its wallets. Any impact on gas prices was unintentional but quickly resolved.”

The Binance 14 address has experienced many gas spending spikes throughout its life, including one on December 9, 2022, which resulted in 880 ETH spent across 24 hours.

Due to the account consolidation procedure, Binance received criticism on social media. Many observers noted that the gas spike would have been greatly reduced if they had just spaced the transactions out over a longer period.

Because of their allegedly ineffective methods, Binance ended up paying more on gas than they might have normally, which increased the cost of the network for everyone else.

“Every interaction I have had with them screams of incompetence,” remarked Rotki app founder Lefteris Karapetsas of the transfers.

Image: Wallpapers.com

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