Bitwise Analyst: The Increasing Amount of ETH Pending Unstaking May Lead to Significant Market Selling Pressure

According to Jinse Finance, the Ethereum blockchain’s validator exit queue reached a record high of 855,158 ETH on Friday. Bitwise Senior Investment Strategist Juan Leon noted that the continuously increasing amount of ETH pending withdrawal may be a driving factor behind the recent pullback in the asset. The queue of unstaked Ethereum typically exerts negative pressure on ETH prices and could lead to significant market sell-off pressure going forward. This is because staked tokens like stETH can trade at a discount, and such discounts reduce collateral value, potentially triggering risk reduction, hedging, or even liquidations, ultimately resulting in spot ETH sell-offs. Leveraged “stETH loop” trades conducted through DeFi protocol liquidity pools will no longer be profitable, and traders closing positions and selling ETH to repay loans will also create synchronized selling pressure.