ChainCatcher news reports that according to market sources, the Ethereum blockchain's validator exit queue reached 855,158 ETH on Friday, setting a new all-time high. Bitwise senior investment strategist Juan Leon stated that the increasing amount of ETH set to be unstaked could be driving the recent pullback of the asset. The queue of unstaked Ethereum typically has a negative impact on ETH prices, which may lead to significant selling pressure in the market.
Because staking tokens like stETH can trade at a discount, the discount can reduce the value of collateral, leading to risk reduction, hedging, or even liquidation. This ultimately results in spot selling of ETH. Leverage 'stETH loop' trading conducted through DeFi protocol liquidity pools will no longer be profitable, creating synchronized selling pressure as traders close positions and sell ETH to repay loans.
