Ethereum exchange supply plummets by 34%! 3.6 million tokens queued for staking and waiting for 63 days

Ethereum exchange holdings decreased from 12.31 million to 8.15 million. 3.6 million are queued for staking with a 63-day wait; only 44,448 tokens exited after 18 hours. Total staked amount is 36 million. BitMine has staked a total of 2.5 million tokens. During sideways trading, supply continues to flow out, and the staking frenzy persists.

Exchange supply lost 4.16 million tokens over six months

(Source: Santiment)

According to Sanbase data posted on X by Santiment on Tuesday, Ethereum holdings on exchanges peaked at 12.31 million tokens in July, then steadily declined to 8.15 million. This means that in just six months, 4.16 million ETH have flowed out of exchanges. At current prices around $3,000, this amounts to approximately $125 billion in assets leaving the exchanges.

Santiment analysts predict that as price volatility stabilizes and more Ethereum is used for staking, the amount of ETH on exchanges may continue to decrease. According to CoinGecko data, over the past week, Ethereum’s price has fluctuated between $2,801 and $3,034, with volatility significantly lower than Bitcoin and most altcoins. They state: “As staking remains highly focused, especially during sideways market consolidation, the supply on exchanges will also continue to decrease.”

The decline in exchange supply has multiple implications. First, it alleviates selling pressure; when ETH flows out of exchanges, it indicates holders are transferring tokens to personal wallets or staking contracts, with no immediate plans to sell. This reduces market selling pressure and supports price floors. Second, liquidity decreases; with less ETH held on exchanges, the available ETH for immediate trading diminishes, so large buy orders could push prices up more quickly (due to thinner sell walls).

Historically, continuous decline in exchange supply often signals a bottom formation. During the 2018-2019 bear market bottom and after the 2022 FTX collapse, ETH exchange supply showed similar decreasing trends, followed by new bull markets. The current pattern of supply outflow is highly similar to these historical bottoms, suggesting the market may be accumulating momentum for the next rally.

However, a decline in exchange supply could have other explanations. Some holders might be long-term holding due to short-term market pessimism rather than active optimism. Additionally, if these outflows eventually enter lending protocols or derivatives markets, they could still exert downward pressure on prices. Therefore, staking data should be considered for comprehensive analysis.

3.6 million tokens queued: an unprecedented staking frenzy

(Source: Ethereum Validator Queue)

Blockchain explorer estimates that as of Thursday, the validator queue on Ethereum is full, with 3.6 million tokens queued for staking, with an estimated wait time of 63 days; meanwhile, only 44,448 tokens are waiting to exit, with an 18-hour wait. This extreme asymmetry clearly indicates market sentiment favors “locking” rather than “unlocking.”

A 63-day wait time is among the longest historically, showing that demand for staking far exceeds network capacity. To protect network stability, Ethereum limits the number of validators that can enter and exit staking per cycle (Epoch, about 6.4 minutes). Currently, only about 8 validators are allowed per Epoch, so with 3.6 million ETH (roughly 112,500 validators of 32 ETH each) queued, it will take tens of thousands of Epochs to process all.

Data from beaconcha.in and Dune Analytics show that the total staked ETH exceeds 36 million, about 29% of the supply, higher than June’s 35 million. This staking ratio is moderate among mainstream PoS blockchains (Solana about 70%, Cardano about 65%), but considering Ethereum’s large market cap (around $360 billion), 36 million staked tokens represent over $108 billion in assets locked.

Ethereum is a proof-of-stake (PoS) network that requires validators to stake tokens to help secure the network. Unstaking is often seen as a signal that validators want to release ETH for sale, while staking can be viewed as a sign of confidence in the asset, since it involves locking tokens that cannot be traded in the short term. Currently, with 3.6 million tokens in queue versus only 44,448 tokens exiting (roughly 80 times difference), this is a very strong bullish signal.

Triple drivers of Ethereum staking

Yield attraction: Current staking APY around 3.5%-4%, providing stable cash flow in sideways markets

Bullish locking: 63-day wait + staking lock-up period, representing a long-term bullish stance on ETH

Institutional influence: Large-scale staking by institutions like BitMine creates a demonstration effect, encouraging retail participation

BitMine re-stakes 250,000 tokens, accounting for 61%

BitMine is increasing its staking commitments. Data analytics firm Lookonchain reports that BitMine has staked an additional 250,912 ETH from its reserves. Lookonchain estimates that BitMine has now staked over 2.5 million tokens, about 61% of its total holdings, a very high staking ratio among institutional investors.

BitMine began staking its reserves in December, transferring 74,880 ETH, indicating a strategic shift. Using 61% of holdings for staking suggests BitMine is not pursuing short-term trading profits but betting on Ethereum’s long-term value growth. The staking yield (around 4% annualized) combined with potential price appreciation offers dual returns.

Some ETH stakers also appear to be buying heavily. Lookonchain notes that on Tuesday, four staking wallets withdrew over 26,000 tokens from Binance, suggesting accumulation of more tokens. This “withdrawal then immediate staking” pattern indicates these large holders are actively building positions rather than passively holding.

On Thursday, Ethereum’s trading volume on CoinMarketCap was about $23.54 billion, below over $27 billion the previous day. The decline in trading volume further confirms the market is in a “low volatility, low trading” sideways consolidation phase. In this environment, staking becomes the most rational choice, providing stable income while avoiding the frictions of frequent trading.