Ethereum Staking Demand Cools as Validator Queue Shrinks, Rewards Decline
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Ethereum's queue for new validators has almost completely cleared out, down from a peak of 96,000 in June. This signals weakening staking demand.
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The queue shrinkage comes after the Shapella upgrade enabled ETH withdrawals, reducing risk for stakers. This initially unleashed a wave of ETH staking.
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But staking growth has cooled amid falling rewards rates, now near 3.5%, and rising Treasury yields over 5%.
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Ethereum's staking ratio has grown to 22% but still lags far behind other major proof-of-stake networks like Solana, Cardano and Avalanche.
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The emptying validator queue implies slowing growth of staked ETH, per a FalconX report. This may be due to ETH's broad shareholder base and use as a network resource.