What does a “stuck on-chain transaction” actually mean, can someone explain?
The least generous read is that they’re testing their withdrawals halting system in preparation.
The least generous read is that they’re testing their withdrawals halting system in preparation.
I bet they are doing waay more withdrawals today, many times over their usual volume so they are hitting some capacity issues, and you can't rush these things.
What they probably mean is that they have a transaction that consumes $1000000 on their address and creates two outputs: $100 withdrawal for client A, and $999900 on a "change" output. Later withdrawals have to link to that change output (bitcoin is a directed acyclic graph of inputs-outputs). If that transaction is not confirmed, then later txs also cannot be confirmed and backlog grows.