On the financial highway of the digital world of Ethereum, an unprecedented 'traffic jam' is taking place. This is not a code bug, nor a network attack, but a capital migration worth nearly $4 billion. As of late August 2025, more than 870,000, or even nearly 910,000, Ethereum (ETH) are anxiously waiting in the 'exit queue'.
. At current prices, this amount of money is as high as $3.8 billion, enough to buy an NBA team, plus several private jets.
Behind this string of cold numbers is a turbulent undercurrent. Why has Ethereum staking, once hailed as a 'goose that lays golden eggs,' suddenly ushered in such a large-scale 'resignation wave'? What's even weirder is that when these stakers scrambled to leave, the ETH lending interest rate in the decentralized finance (DeFi) world soared like a rocket, once soaring to over 10%
, forming an incredible 'negative interest rate spread' - that is, the interest you pay to borrow ETH is far more than the return you can earn by staking ETH.
What exactly is being sold in this gourd? Everything behind this points to the elephant in the room - the Ethereum staking ETF that is about to debut on Wall Street.
Today, let us dissect and delve into the center of this storm to uncover the three major mysteries behind this $3.8 billion migration: the record-breaking unstaking queue, the strange negative interest rate spread, and the looming shadow of the ETF.
I. The Unprecedented Unstaking Long Queue: A 'Great Migration' Worth Nearly $4 Billion
Let's first look at this staggering scene.
Ethereum's 'exit queue' is a mechanism designed by the network to maintain stability. It is like a bank's withdrawal window. To prevent bank runs, the number of withdrawal requests that can be processed every day is limited. Under normal circumstances, this queue is not long, and the waiting time is only one or two days. However, starting in July 2025, the situation took a sharp turn for the worse.
In late July, the number of ETH waiting to be withdrawn was still hovering around 520,000, worth nearly $2 billion, and the waiting time had been extended to more than 9 days. By mid-to-late August, this number snowballed and directly broke through 890,000, and some data even showed that it was close to 910,000 ETH. The waiting time was also ruthlessly extended to more than 15 days.
Imagine, nearly $4 billion in funds being told that they need to wait in line for more than half a month to get their hands on it, which is undoubtedly an ordeal in the ever-changing financial market.
It needs to be clarified that this does not mean that there is a crisis in the Ethereum network itself. On the contrary, the total amount of ETH staked on the entire network currently exceeds 36 million, accounting for nearly 30% of the total supply, and the number of active validators has also exceeded 1.12 million.
. This huge 'exit army' is still a minority relative to the total amount of staking. However, the key issue is not the absolute number, but the speed of its growth and the motivation behind it.
This is by no means a panic sell-off, but more like a well-planned and premeditated strategic transfer. So, what force is driving these smart funds to leave even if they have to wait in a long line? The answer lies in the interest rate fluctuations in the DeFi market.
II. The Mystery of the Negative Interest Rate Spread: When the Cost of Borrowing Money Far Exceeds the Return on Saving Money
If you are a rational investor, would you do a deal of 'borrowing money at 10% interest and saving money at 3% interest'?
Normal people would say no. But in the DeFi world in the summer of 2025, this became the norm.
The annualized yield (APY) of Ethereum staking has remained stable in a range in recent years. According to forecasts for 2025, this number is approximately between 3.5% and 4.5%
. Some data sources even show that due to the continuous increase in the total amount of staking and the dilution of rewards, the actual yield may be lower, such as around 3.2%
. This is like depositing money in the Ethereum 'digital central bank' and taking a fixed interest every year, which is stable but not amazing.
However, almost at the same time, the DeFi lending market underwent dramatic changes. On mainstream lending platforms such as Aave and Compound, the borrowing interest rate of ETH soared from the usual unremarkable 2%-3% to easily break through the 10% mark.
On one side is a 3% staking return, and on the other side is a 10% borrowing cost. This huge 'negative interest rate spread' (Negative
Spread) phenomenon completely subverted many traditional arbitrage models. Usually, borrowing interest rates are anchored to staking yields, because there will always be people who borrow ETH to participate in higher-yield activities, but borrowing costs rarely exceed the basic interest rate for a long time and to a large extent
.
So, who is borrowing ETH regardless of cost?
The answer is: those 'whales' and advanced players who once used leverage to stake.
In the past, a very popular strategy was 'leveraged staking':
Users stake their ETH and get a liquid staking certificate (such as stETH).
Then, he borrows more ETH from platforms such as Aave using stETH as collateral.
Then, take the borrowed ETH to stake again and obtain stETH certificates again... and so on, repeatedly.
In this way, they can amplify their principal and thus earn returns far exceeding ordinary staking. This is an ingenious financial game, but when exiting, it becomes a challenge of 'disassembling dominoes'. When these players decide to close their positions and exit, they must operate in reverse: repay the ETH they borrowed initially.
This has led to an explosive increase in the demand for spot ETH lending in the market in a short period of time. Tens of thousands of leveraged players rushed into the market at the same time to borrow ETH to repay debts. When supply could not meet demand, borrowing interest rates naturally rose sharply, soaring to over 10%.
And why are they in such a hurry to close their positions and leave? This leads to the final protagonist of our story.
III. The Elephant in the Room: The Coveted Ethereum Staking ETF
Behind all these market changes is a huge shadow - the highly anticipated Ethereum Staking ETF.
Since the U.S. Securities and Exchange Commission (SEC) gave the green light to the spot Ethereum ETF in 2024, the entire market has focused on the next bigger gold mine: an ETF product that not only holds ETH but also distributes staking rewards to investors.
As of August 2025, Wall Street giants are already gearing up. BlackRock's iShares, Bitwise, and other companies have submitted relevant proposals, hoping that the SEC will approve their ETF products to add staking functionality.
. Although the SEC's approval process is still full of uncertainty, public comment solicitation and evaluation are still in progress
, but the general expectation of the market is that this shoe will drop sooner or later, and there are even rumors that there may be results in the next few months.
This expectation is like a boulder thrown into a calm lake, stirring up a thousand waves. It directly triggered the 'unwinding' of leveraged players and the large-scale unstaking wave mentioned earlier. There are three reasons:
Early Profit Taking and Risk Avoidance: Many large households and institutions that participated in staking early have enjoyed many years of dividends. They know the truth of 'buy on rumors, sell on news'. They expect that when the ETF is officially launched, the market may experience a brief correction or drastic volatility due to the realization of the news.
. Therefore, they choose to exit early, put the income into their pockets, and turn floating profits into tangible profits. Waiting for 15 days is worth the wait for them.
Providing liquidity for ETFs: The birth of ETFs means the opening of a brand new and huge trading market. Market makers and large trading companies need to prepare a large amount of liquid ETH that can be traded at any time to meet the issuance, redemption, and secondary market trading needs of ETFs. They cannot use ETH locked in staking contracts for market making. Therefore, unlocking their staked ETH and converting it into a liquid state is a necessary preparation for them to welcome this financial feast.
Reassessment of future returns: Once behemoths like BlackRock enter the market with tens of billions of dollars and start staking ETH, the total staking volume of the entire network will inevitably increase significantly. According to Ethereum's design, the more ETH staked, the less rewards each validator can receive, and the overall APY will be diluted.
. Some savvy investors may think that instead of waiting for future returns to decline, it is better to leave now and look for other investment opportunities with higher returns.
These three forces intertwined and jointly directed this grand unstaking wave.
At this point, we can easily come to a conclusion:
The current record-breaking Ethereum unstaking wave is not a collapse of network confidence, but a market behavior driven by mature financial logic. It is a 'major reshuffle' and 'major game' surrounding the upcoming Ethereum staking ETF.
Unstaking long queue is the appearance, which is the embodiment of the strategic retreat of leveraged players and visionary capital.
DeFi high interest rates are a catalyst and an inevitable 'pain' during the deleveraging process.
ETF expectations are the fundamental driving force behind all of this, and the huge attraction generated in the process of integrating traditional finance with the crypto world.
Looking to the future, after this storm, the Ethereum ecosystem will usher in a new pattern.
First, when this wave of deleveraging subsides, the borrowing interest rate in the DeFi market will likely return to normal levels. Second, the length of the unstaking queue will become a 'barometer' for observing the market's expectations for the launch of the ETF. Finally, and most importantly, when the Ethereum staking ETF is truly approved and listed for trading, it will bring unprecedented institutional-level capital inflows and legitimacy endorsement to Ethereum.
.
This will not only profoundly affect the price and market value of ETH, but also mark Ethereum's true evolution from a geek's technical experiment field into an indispensable part of the global financial system.