And the issue is back. Even when i see the yellow chain i'm unable to use the hotbar or anything in my inventory.

I am having the same problem - yellow chains, unable to interact with inventory pick up items open doors. All the same issues - I tried going into busy servers but it seems to resolve the issue for a short period of time then back to square one - I have on occasion had to completely leave steam reconnect and then it starts all over again Is it steam or the game itself I dont know but It only seem to happen to me after a battle eye update

Just tried this and i confirm the issue goes away with a full-ish server. However it seems strange to me that you are unable to play on a server with just a few people on it.

hmmm i can't even find a full server... will try and report back.

I dropped the extra backpacks and it hasn't resolved the issue. Logging on to a full server seemed to fix the problem, but that may have been random, as logging into a 38/40 server earlier did not fix the issue.

I currently have a single hunters backpack and a carrying case. Clearly nothing too excessive. I've had that same getup for days.

I've had this problem as of yesterday as well. I removed and reinstated the game and it seemed to help for a few moments but then the issue returned. I was able to get the problem to go away by drinking water a few times but then after I re logged it returned. Now I am stuck inside a house and the door will not open. I've been on several servers but no matter the issue will come back and I am pretty much unable to play the game at this moment. I've noticed it's more than just not being able to hold anything in my hands, I also don't seem to be able to set anything down around me either. i.e., weapons box. I can move it around in my inventory but it won't let me set it down.

I can vouch for this issue. I was unable to play at all last night because I could not use my hotkeys, and my inventory would only say "Receiving..." when I right-clicked an item.

What should be noted is that I tried to drop an item on the floor, and while it did not visually seem to drop, it had in fact dropped when I logged out and logged back in. (At least, that's when I saw it had dropped. It probably dropped right when I tried to drop it).

(Also, the server capacity was a non-factor, as I played on full and empty servers)

^^^ Which I DO have. I am carrying 3 backpacks for a friend.

I am only carrying my pack though. No other items with their own storage except an ammo box and a first aid kit so I'm not thinking mine was caused by the back pack bug.

I just got the same issue last night. I have a mountain back pack, fully pristine M4A1, pistol with 4 clips, an ammo box, a golden lock box, and 2 first aid kits.

UPDATE: I just met up with a friend, but he was completely invisible to me. Likely because to me, he was still standing where he was when I logged in. I say this because after having to log off and log back in multiple times to exchange gear, he would be positioned wherever he was when I would log back on (I hope that makes sense).

It's like the environment around me is entirely frozen, including items in my inventory and hotbar.

A full reinstall did NOT solve the problem.

Since there is no Suicide option I decided to try servers until I found a zombie to kill me so I can try a new character and see if the bug is still there. Found a zombie, let him kill me( which isn't hard since I couldn't hit him with a cereal box if I wanted to), when I was dead I was unable to respawn. Waited like 15 minutes, still nothing. So I relogged back to another server and then I'm back the way I was before I died.

We need this bug fixed ASAP!!! I can't play my game and I can't die. WTF! lol.

So something that worked for me tonight, that you might try, is running Steam in Big Picture mode. I had all the same issues when I first logged in. Tried all the same troubleshooting and still had all the same issues. However, when I started up steam and ran the game from the library while Steam was in big Pic I noticed that after a few minutes being logge'd in, everything returned to normal. I didn't have long to play but I relogged, dropped windows, messed with my desktop and keyboard/mouse and everything kept working fine. I'll try again tomorrow and see if it continues to be fixed.

This same issue happens frequently to a friend of mine. He can log in by himself and he's fine, but the minute any of us (myself and 2 others) log in nearby or approach him, he begins to exhibit these issues (can't equip weapon/interact with objects/etc).

This has happened on almost every server we've tried except one. On that server, he never experienced the problem. It didn't seem to have anything to do with the server population either - sometimes we were the only ones online, and occasionally there were up to 20. Unfortunately, that server appears to be gone now, so now we're back to hopping around (as often as we can) to try and find a new one that works...