Ethereum saw its largest-ever validator exit this week, with over 2.4 million Ether — valued at more than $10 billion — awaiting withdrawal from its proof-of-stake network. Despite the massive outflow, institutional players are filling much of the gap through new validator entries.
As of Wednesday, Ethereum’s exit queue had surpassed 2.4 million Ether, pushing the total value waiting to withdraw beyond $10 billion. The surge in exits has stretched the queue time to more than 41 days and 21 hours, according to data from ValidatorQueue.com.
Validators, who play a vital role in maintaining the Ethereum network by verifying transactions and adding new blocks, continue to be a cornerstone of its proof-of-stake ecosystem.
$10 Billion Ethereum Exit Queue Sparks Fears of Increased Sell Pressure
The sharp rise in pending validator withdrawals has renewed concerns about potential sell pressure on Ether.
While not all exiting validators are necessarily seeking to cash out, a portion of the $10 billion awaiting withdrawal could still be sold — especially given Ether’s 83% price surge over the past year, according to Cointelegraph’s price index.
Adding to the concerns about selling pressure, the validator exit queue is about five times larger than the Ethereum entry queue, which currently holds over 490,000 Ether set to be staked, with a wait time of eight days and 12 hours.
Despite ongoing short-term concerns over selling pressure, the $10 billion in pending withdrawals does not pose a threat to Ethereum’s network stability. The network still maintains over 1 million active validators staking 35.6 million Ether — roughly 29.4% of the total supply.
The news comes just a day after Grayscale staked $150 million in Ether on Tuesday, following the launch of staking options for its Ether exchange-traded products. This made Grayscale the first U.S.-based crypto fund provider to offer staking-based passive income for its funds.
On Wednesday, Grayscale added another 272,000 Ether, worth $1.21 billion, to the staking queue. According to on-chain analyst EmberCN, this makes the company responsible for “the majority of coins currently awaiting staking activation.”
Despite the ballooning validator exits, Ether’s momentum continues to be driven by institutional inflows via exchange-traded funds (ETFs) and corporate treasuries, Iliya Kalchev, dispatch analyst at digital asset platform Nexo, told Cointelegraph:
“Institutional and corporate treasuries now hold over 10% of ETH’s total supply, while October ETF inflows have already exceeded $620 million.”
“The data reflect Ethereum’s evolution into a yield-bearing, institutionally recognized asset used both for infrastructure and collateral purposes,” he added.
