Opinion: Ethereum Staking Requires a 43-Day Wait, Not Necessarily a Bullish Sign; Empty Exit Queue a Stronger Market Confidence Indicator

BlockBeats News, July 31st, Sygnum Bank's Head of Custody and Staking Operations, Thomas Brunner, stated that the number of Ethereum validators in the queue has increased to around 2.5 million ETH. New stakers need to wait about 43 days to activate, but this data should not be simply seen as a bullish signal, as the backlog reflects both institutional demand and is influenced by protocol mechanics.

Brunner pointed out that the Dencun upgrade has reduced the daily validator entry limit to around 57,600 ETH, while the Pectra upgrade did not increase this limit. At the same time, Pectra allows a single validator to hold up to 2048 ETH and automatically compound. Large operators are adding stake to existing validators, and even if they add only 1 ETH, they need to enter the same queue as new stakers. Therefore, the current backlog partly comes from the reconfiguration and compounding of existing stakes, rather than solely from new ETH demand.

In contrast, the almost empty exit queue provides a clearer signal. Brunner stated: "Almost no one is unstaking, which reflects true confidence; the queue entry measures both demand and infrastructure mechanics." Currently, about 41.2 million ETH is in a staking state, accounting for 33.8% of the circulating supply.

He also mentioned that institutions have not stopped participating despite the weakening ETH price, as many institutions see staking rewards as an intrinsic property of ETH. However, validator addresses, deposit addresses, and withdrawal credentials can be traced, and privacy concerns remain a significant barrier for institutions to scale up their staking.