Ethereum News Today: Investors Flee Staking as Ethereum Exit Queue Surpasses $3.9 Billion

Ethereum’s validator exit queue reached a peak high of nearly 910,461 ETH, equivalent to $3.9 billion, as of August 18, marking the largest withdrawal volume since the network’s transition to proof-of-stake in 2022 [1]. The growing queue, which now accounts for over 2.5% of Ethereum’s total supply, indicates a surge in staking withdrawals, driven largely by the top three liquid staking platforms: Lido, EthFi, and Coinbase [1]. The waiting period for unstaking has extended to approximately 15 days, according to data from Validator Queue [1].

This wave of validator exits has coincided with a 15% correction in ETH price from its recent peak of $4,800 to around $4,200, following a brief rally to over $4,700. Analysts suggest that the increased withdrawals may reflect profit-taking by investors who have held staked ETH at lower prices, particularly amid rising annualized returns from Ethereum ETFs currently under U.S. Securities and Exchange Commission (SEC) review [1]. A notable development in the market is the growing demand for staked Ethereum ETFs, with BlackRock proposing to integrate staking into its iShares Ethereum Trust (ETHA) in a move that could gain regulatory approval as early as October 2025 [1].

The imbalance between staking and unstaking demand has widened significantly, with current staking demand at 258,951 ETH—worth around $1.09 billion—compared to the massive 910,461 ETH in the exit queue. This disparity highlights a shift in investor behavior, with many preferring to hold ETH in liquid form rather than re-stake. Over 35.3 million ETH, or approximately 29.45% of the total supply, remains staked on the Beacon Chain, while new staking demand has fallen below exit demand [1]. The exit activity has also sparked concerns about potential depegging of liquid staking tokens like Lido’s stETH, especially after leveraged trades in DeFi platforms like Aave led to rising borrowing rates and forced unwinding of positions [3].

The surge in unstaking has raised questions about the impact on the broader DeFi ecosystem. Large-scale withdrawals from liquid staking protocols could lead to de-pegging events and increased volatility in related tokens, particularly affecting platforms that use liquid staking tokens as collateral. LidoDAO, for example, recorded the largest outflows in the past month, losing 281,824 ETH. This trend is also seen as a response to the need to move out of liquid staking tokens to reduce liquidation risks, especially during market downturns [2]. The growing exit queue may also signal a shift in capital reallocation strategies, with investors potentially moving funds into staked Ethereum ETFs as an alternative to holding liquid staking tokens [1].

Despite the increased selling pressure from validator exits, strong inflows into spot Ethereum ETFs and Ethereum treasury accumulation have partially absorbed the downward pressure on ETH price. However, net flows into Ethereum ETFs have turned negative in recent sessions, with BlackRock’s ETHA and Fidelity’s FETH both experiencing significant outflows. The ETH price currently holds at $4,200, with daily trading volume declining to $45 billion as market participants await key developments in staking and ETF approvals [1]. Analysts remain cautious, noting that while validator exits are not inherently bearish, the prolonged waiting period and potential depegging of staking tokens could introduce further volatility in the near term [3].

Source:

[1] Ethereum Exit Queue Tops $4B as Staking Withdrawals Spike – Is a Staking ETF Approval Ahead? (https://coingape.com/ethereum-exit-queue-tops-4b-as-staking-withdrawals-spike-is-a-staking-etf-approval-ahead/)

[2] Ethereum validator exit queue hits $3.2B as ETH nears all-time high (https://www.mitrade.com/insights/news/live-news/article-3-1040481-20250814)

[3] Ethereum Validator Exit Queue Hits Record 910,461 ETH (https://unchainedcrypto.com/ethereum-validator-exit-queue-hits-record-910000-eth/)