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27 March 2023
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Exchange & WalletNews

Binance carries out an upgrade and closes its doors for eight hours, how does bitcoin react?

The world’s largest cryptocurrency exchange Binance will upgrade at 3 a.m. next night. Binance will therefore not be usable for eight hours, and given the large trade volume of the exchange, this may have a significant effect on bitcoin (BTC) and Binance Coin.

For example, it is common for crypto traders to close their positions before such an upgrade in order to avoid unnecessary risk. It is therefore likely that the BTC price will end up in a dip. How bad that dip will be is difficult to predict.

We do know that the bitcoin price almost halved during the previous upgrade, from $ 6,000 to $ 3,000. Only bitcoin will not be the only cryptocurrency this time that will be affected by the Binance upgrade.

Binance’s own cryptocurrency Binance Coin, an altcoin that managed to increase strongly in value despite the crypto-winter, will most likely also be affected by the upgrade.

It is not clear to many why Binance exactly carries out the upgrade. However, Changpeng Zhao assures customers that their funds are safe. Binance has a special fund for customers, where 10% of all transaction costs go to. This Secure Asset Fund for Users (SAFU), offers extra security if something goes wrong, so that customers’ assets are lost.

The upgrade takes place on March 12, three o’clock at night Dutch time. During the upgrade, no crypto can be deposited, traded or recorded. The maintenance is expected to last 8 hours, Binance estimates. Note that it can also take longer than the estimated 8 hours.

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