Transaction Delays Prompt Binance to Temporarily Halt Multichain Token Deposits

Binance is waiting for “clarity from the Multichain team.”

Leading global cryptocurrency exchange Binance has opted for a temporary suspension of transfers of wrapped tokens via the Multichain bridge in response to significant delays in transaction times.

On May 25th, Binance announced the cessation of deposits for ten tokens bridged to multiple chains such as Binance Chain, Ethereum, Avalanche, and Fantom.

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When it came to the matter, the official statement from Binance noted:

We’ll be temporarily suspending deposits for the following bridged tokens-network while we await clarity from the Multichain team.

Issues pertaining to Multichain’s zkSync, Kava, and Polygon zkEVM bridge were reported by users, with transactions to these networks having been stalled since May 21st.

To minimize user concerns, the Multichain team assured that “pending transactions will be credited automatically” and revealed that a compensation plan for those affected is in the works.

DJ Qian, the co-founder of Multichain, stated that he had been engaged in discussions with the bridging project’s CEO to resolve the issue.

A Multichain wrapped asset is locked in a Multi-Party Computation (MPC) node on the source chain, after which a corresponding wrapped asset is minted on the target chain. An MPC node acts as a digital gateway controlled by particular wallets, with the private key divided, encrypted, and shared among multiple entities.

According to DeFiLama, Multichain currently possesses locked deposits valued at $1.51 billion for liquidity provisions. It is worth noting that total value locked (TVL) throughout this week’s events dropped from $1.6 billion to $1.51 billion.

Binance’s decision to temporarily halt Multichain token deposits comes in the wake of a series of transaction delays that have rocked the crypto world. As the industry grapples with these technical hiccups, the communication from the Multichain team provides a glimmer of hope for users.