Ethereum validator exit queue spikes as Celsius, Figment withdraw stakes

Quick Take

  • The Ethereum blockchain saw a record spike in validator withdrawal requests, with the exit queue reaching over 16,000.
  • Over 500,000 ether are in the exit queue, with a maximum stake of 32 ether per validator.
  • Celsius, undergoing restructuring, is withdrawing many stakes — contributing significantly to the queue.

The Ethereum ETH +3.21% blockchain is experiencing a spike in validators queuing to withdraw their staked ether. The exit queue has reportedly reached 16,000, according to data from ValidatorQueue. The queue represents more than 510,000 ether ($1.1 billion), with a maximum validator stake of 32 ether per validator.

The processing time for completing the exit queue will be five days, with a total withdrawal length of more than 14 days.

This comes as Celsius, going through restructuring after filing for bankruptcy protection last year, shared its plans to cancel its stake in the Ethereum network — intending to distribute assets to its creditors.

Celsius’ withdrawal request of more than 200,000 ETH ($450 million) has contributed to the heightened validator exit queue. However, it seems that Celsius is not alone. Nansen data shows that only 32% of exits belong to Celsius. 54% (350,000 ETH) of the validators waiting to be withdrawn are associated with staking provider Figment.

Tom Wan, an analyst at 21 Shares, thinks that those tagged as Figment may also belong to Celsius. “It is also likely that the withdrawal by Figment belongs to Celsius. Earlier in June, when Celsius redeemed 428k stETH from Lido, it re-staked 197k ETH via Figment,” Wan said. Still, not all of Figment’s withdrawals would account for Celsius, Nansen clarified.

There are currently a total of 29 million ETH staked on the network, according to The Block dashboard. This means that these withdrawals (roughly 500,000 ETH) account for roughly 1.7% of the total stakes.


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Staking yield

Despite the surge in validators lining up in the exit queue, the entry queue for new validators has remained close to zero — mirroring the levels observed last week. The time to complete exit and entry queues is based on the churn limit, which is 13 validators per epoch, or a daily cap of 2,925 validators entering or exiting the network.

The staking yield for Ethereum validators, also known as the staking rewards reference rate, currently stands at about 3.4%. This figure shows a decrease from the near 8% yield recorded in May 2023.

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© 2023 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

About Author

Vishal Chawla is The Block’s crypto ecosystems editor and has spent over six years covering tech protocols, cybersecurity, artificial intelligence and cloud computing. Vishal likes to delve deep into blockchain intricacies to ensure readers are well-informed about the continuously evolving crypto landscape. He is also a staunch advocate for rigorous security practices in the space. Before joining The Block, Vishal held positions at IDG ComputerWorld, CIO, and Crypto Briefing. He can be reached on Twitter at @vishal4c and via email at [email protected]


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