Ethereum is witnessing an unprecedented exodus of validators, with over 1 million Ether tokens currently queued for withdrawal from the staking process within Ethereum’s proof-of-stake (PoS) framework.
The exit queue for Ethereum exceeded 1 million Ether (ETH), valued at $4.96 billion, on Thursday. This figure represents the Ether set for withdrawal by the network’s validators, who play a crucial role in creating new blocks and verifying transactions, thus maintaining the integrity of the blockchain.
This mass exit has resulted in a record waiting time of 18 days and 16 hours for validators looking to withdraw, according to data from validatorqueue.
While this may not indicate that all validators intend to liquidate their holdings, a substantial portion of the nearly $5 billion could be sold to realize profits, given that Ether’s value has surged by 72% in the past three months.
Ether validator queue. Source: validatorqueue.com
“The exit queue reaching 1 million ETH signifies healthy market dynamics rather than an alarming trend,” remarked Marcin Kazmierczak, co-founder of RedStone blockchain oracle firm, in an interview with Cointelegraph, adding:
“It’s essential to realize that these exits are minimal compared to the institutional investments being directed towards Ethereum.”
The “unprecedented demand” from institutions such as treasury firms and exchange-traded funds indicates that the sales from validators are “comfortably absorbed by this institutional demand,” he further explained.
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Ether continues to be the ‘liquidity magnet’ of the crypto market: analyst
Ether remains a “liquidity magnet” in the crypto space, with Ether futures open interest approaching $33 billion, showcasing solid institutional interest, according to Iliya Kalchev, a dispatch analyst at digital asset platform Nexo.
“Standard Chartered has reiterated that ETH and ETH-treasury firms are undervalued even at current prices, projecting a year-end target of $7,500,” the analyst stated, adding:
“Coupled with Polymarket odds now suggesting a 26% probability of ETH hitting $5,000 this month, Ethereum’s position as the market’s liquidity magnet cannot be overlooked.”
Ether “appears ready to challenge the $5,000 mark,” the analyst noted, suggesting that investor sentiment may be influenced by Thursday’s release of the US initial jobless claims and Friday’s unveiling of the Personal Consumption Expenditure Price Index (PCE), the Federal Reserve’s favored inflation metric.
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Ether validator and exit queue. Source: validatorqueue.com
In stark contrast to the 1 million Ether slated for exit, only 737,000 Ether are queued for staking, with an average wait period of 12 days and 19 hours.
Nonetheless, the network remains robust with over 1 million active validators and 35.6 million Ether staked, accounting for over 29.4% of the total supply.
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