TLDR
- Ethereum’s validator exit queue hits 18-month high with 644,330 ETH ($2.3 billion) waiting to unstake with 11-day delays
- Exit queue surge follows ETH’s 160% rally from April lows and recent peak at $3,844 on Monday
- Net unstaking is only 255,000 ETH as 390,000 ETH worth $1.2 billion sits in entry queue
- Validators may be repositioning rather than selling, with some moving to optimize operations or change custodians
- Justin Sun’s $600 million ETH withdrawal from Aave briefly caused Lido’s stETH token to depeg
Ethereum’s validator exit queue has reached its highest level in 18 months as investors and validators rush to unstake their holdings following a major price rally. The queue now contains 644,330 ETH worth approximately $2.3 billion, creating an 11-day wait time for withdrawals.
The surge comes after ETH climbed 160% from its April lows and hit a seven-month high of $3,844 on Monday. The cryptocurrency has since pulled back about 7% from that peak, trading around $3,643 at recent levels.
The exit queue represents the largest backlog since January 2024, when a similar spike occurred during a price correction. Ethereum’s proof-of-stake system limits how quickly validators can join or leave the network, creating bottlenecks during periods of high activity.
Validators stake ETH to help secure the blockchain and earn rewards in return. The current exodus appears driven by profit-taking from those who staked when prices were much lower.
Repositioning Rather Than Panic Selling
Despite the large exit queue, experts suggest the movement represents strategic repositioning rather than panic selling. Staking protocol Everstake noted that validators are likely exiting to “restake, optimize or rotate operators” rather than abandoning Ethereum entirely.
The data supports this view, as 390,000 ETH worth about $1.2 billion sits in the entry queue. This means the net amount being unstaked is only around 255,000 ETH, suggesting many are simply changing their staking arrangements.
Corporate treasury firms like SharpLink and Bitmine have been aggressively accumulating ETH since early June. Most institutional players have indicated they plan to stake their holdings for additional yields.
Record Staking Activity Continues
The number of active validators has reached an all-time high of nearly 1.1 million. Total staked ETH stands at around 35.7 million tokens, representing almost 30% of the total supply and worth approximately $130 billion.
US spot Ether ETFs have seen strong demand with over $2.5 billion in inflows over six trading days. Apollo Capital’s Henrik Andersson noted $8 billion in net inflows through DeFi bridges into Ethereum mainnet over three months.
The institutional interest demonstrates continued confidence in Ethereum despite the current unstaking activity. Andersson highlighted that this shows “interest from onchain natives and institutions” even as Bitcoin ETFs experienced outflows.
Lido Token Briefly Loses Peg
Adding to market volatility, Tron founder Justin Sun recently withdrew around $600 million worth of ETH from the Aave lending platform. This action briefly caused Lido’s liquid staking token (stETH) to lose its peg to ETH and reduced liquidity on Aave.
The withdrawal may have contributed to the exit queue as concerned yield farmers attempted to convert stETH back to ETH. RedStone co-founder Marcin Kazmierczak observed that some users rushed to sell on secondary markets during the brief depeg event.
Andy Cronk from staking service Figment explained that unstaking spikes follow predictable patterns. Large institutions also contribute to queue activity when moving custodians or upgrading wallet technology.
The current exit queue activity reflects natural market dynamics as ETH prices remain up more than 50% over the past month despite recent pullbacks.
