The Ethereum ETH +0.59% 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.

Ethereum validator exit queues spike | Source: ValidatorQueue

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 However, it seems that Celsius is not alone. 54% (350,000 ETH) of the validators waiting to be withdrawn are tagged as staking provider Figment. Nansen data shows that only 32% of exits belong to Celsius.

However, Tom Wan, an analyst at 21 Shares, thinks that those tagged by Nansen 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.

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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