Ethereum exit queue hits record $3.9B as validators line up to withdraw

As of Tuesday, August 19, Ethereum’s staking network has more than 910,000 ETH, worth roughly $3.9 billion, locked in the exit queue.

As seen on Validator Queue charts, this is the largest figure recorded since Ethereum transitioned to proof-of-stake in 2022. The platform’s current estimates place the average waiting time at 16 days before processing withdrawals.

Ethereum Validator Queue Chart. Source: Validatorqueue.com.

Market data shows much of the demand for validator exits is from two of the network’s biggest staking providers, Lido and Coinbase. The former accounts for about 40% of the ETH waiting to leave, while Coinbase represents roughly 15%. Collectively, they make up more than half of the current withdrawal numbers.

Validator queue trends: Exit numbers hit new record

Data from the Validator Queue dashboard shows the staking exit tally has been under strain for the last 30 days, briefly dropping below 500,000 ETH at the start of August before spiking by over 70% in a fortnight. 

On July 21, entry requests, representing new ETH being staked, stood close to 350,000 ETH, while exits were slightly higher at just above 400,000 ETH. By the end of the month, exit requests surged to more than 700,000 ETH, peaking around July 25. 

The number of new staking entries fell over the same period, sliding to near 200,000 ETH. Throughout early August, exits consistently outpaced entries, though the exit queue dipped to around 400,000 ETH on August 6 before treading upwards the steep chart again.

By August 16, the withdrawal side of the queue accelerated towards 900,000 ETH, while entries rebounded only modestly to around 344,000 ETH. As of August 19, validators requesting entry totaled 268,217 ETH, compared to nearly one million ETH waiting to exit.

Despite the large exit queue, on-chain data shows that 35.6 million ETH was staked on August 19, representing about 29.4% of the total Ethereum supply.

The staked balance rose on August 14, jumping from 34.5 million ETH to more than 35.6 million ETH in a single day. Since then, staked totals have been stable, fluctuating slightly as entry and exit requests balance each other out.

Why are validators exiting?

According to most analysts on social media platform X, speculation surrounding the approval of US spot Ethereum staking ETFs, expected later this year, has encouraged some investors to unwind positions, readying their reserves for new financial products.

Ethereum’s price, now trading near $4,230 after a 25% rally this quarter, has also prompted some stakers to take profits. Institutional players may be looking to sell their staked tokens to add liquidity either for profits, or their decentralized financial needs. Some institutions are reallocating capital toward higher-return strategies outside of Ethereum’s validator system.

Solarity developer Artem Chystiakov believes the ballooning exit queue is not necessarily a negative spell for the network’s health. “The exit queue is good. The number of Ethereum validators really must go down. Almost 1.1 million active is quite insane to be honest. EIP-7251 consolidation helps, but not as effectively as expected,” he posted on X.

The withdrawal system functions as a throttle, limiting how quickly validators can leave to maintain network stability. Once a validator opts to stop validating, their ETH enters the queue before being swept to a withdrawal address.

Still, an exit does not automatically mean the ETH will be sold. Many validators choose to restake, deploy their tokens in decentralized finance, or hold them in custody. 

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