Major cryptocurrency exchanges Binance and Bybit temporarily suspended withdrawal services on February 5-6, 2026, as the crypto market experienced a sharp and rapid selloff. The interruptions, which lasted approximately 20 minutes on Binance, were attributed to technical strain from surging user activity, not liquidity issues.
Binance cited "technical difficulties" affecting its platform, informing users via X (formerly Twitter) that its team was working on a fix. Services were restored shortly after. Binance co-founder He Yi clarified that the disruption was technical in nature and not malicious, while CEO Changpeng Zhao dismissed online rumors that the exchange was orchestrating the selloff as "imaginative FUD."
Bybit faced a similar withdrawal freeze, though it did not provide specific details on the cause. The simultaneous issues on two major platforms raised concerns about exchange reliability during periods of extreme market volatility.
The suspensions occurred against a backdrop of a severe market downturn. Bitcoin (BTC) plummeted more than 13%, briefly trading below $64,000—its lowest price point since October 2024. The selloff erased significant gains from the prior year and intensified investor anxiety.
Contrary to social media narratives urging users to withdraw funds, on-chain data revealed that Binance's net balances increased during the turmoil, indicating deposits exceeded withdrawals. He Yi noted that a coordinated "withdrawal campaign" within parts of the community had the opposite effect, with total assets on Binance addresses rising. She suggested such campaigns can act as a stress test for exchanges.
Binance reaffirmed its strong financial position, with reported reserves of approximately $155.64 billion as of January 2026, maintaining its status as the industry's largest liquidity provider. Both exchanges advised users to remain calm during volatility and consider self-custody options like Binance Wallet, Trust Wallet, or hardware wallets for added security.
