Ethereum Validators Withdraw Over $3.6 Billion, ETH USD Declines: What’s Happening?

In August, Ethereum’s crypto asset surged by an impressive 40%. This increase is remarkable. At this trajectory, Ethereum USD is not far from surpassing 2021 peaks, and Ethereum crypto could potentially reach $5,000 by Q3 2025. Despite the uptrend developments surrounding ETHUSDT, it was unexpected to see significant unstaking of previously locked Ethereum across various liquid staking platforms like Lido.

Recent updates shared on X indicate that a staggering 761,000 Ethereum, valued at over $3.6 billion at current prices, has entered the unstaking queue. Interestingly, this rush to unstake Ethereum coincides with a price correction that is affecting several of the leading Solana meme coins.

1/ Unprecedented amount of $ETH is in the unstaking queue:

671k $ETH = $3.2B USD

Additionally, queue wait times have reached a database of around 12 days.

What’s behind this? Several factors: pic.twitter.com/W2dAXXxome

— Ignas | Decentralized finance (@DefiIgnas) August 14, 2025

Ethereum USD Declines From $4,750

According to the daily chart for ETH USD, prices dropped from approximately $4,750 to under $4,500.

This decline is paired with a surge in trading volume, indicating potential sellers maintaining their positions, limiting profits. To generate a rally, ETH must close above $4,800, which is exactly what’s required for Ethereum ▼-2.52% crypto to reach as high as $5,000, establishing a new all-time high.

However, if sellers dominate today, a close beneath $4,440 could lead to a reversal of gains for Ethereum, with the next target being $4,000. This level serves as psychological base level, reflecting previous price ceiling that hindered ETH bulls in July 2025.

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Unstaking Ethereum: What’s Happening?

In light of the ETHUSDT price trends, the surge in unstaking could hasten the sell-off. As a proof-of-stake platform, ETH is dependent on validators. There are over one million validators who have each locked an average of over 32 ETH, which helps secure Ethereum while earning block rewards and fees in return.

(Source: Beachocha.in)

While a minimum of 32 ETH is required to operate a network node node within Ethereum, there are alternative services, such as Lido Finance and Rocket Pool, which aggregate ETH from holders and stake them on the blockchain, then share rewards.

As of August 15, Lido Finance ranks as one of the foremost liquid staking platforms. According to DefiLlama, this platform administrates over $41 billion in assets, primarily in Ethereum.

(Source: DefiLlama)

Recent trends indicate that there is an increasing desire among ETH holders to withdraw their assets from the platform, primarily through liquid earning yield services like Lido Finance.

Within a few days, the unstaking queue grew from fewer than 2,000 ETH to more than 760,000 Ethereum. This surge has resulted in Ethereum’s exit mechanisms, which restrict node exits per epoch, being put under pressure.

(Source: Validator Queue)

Prior to this increase, processing a withdrawal took about 6.4 minutes. It now exceeds 12 minutes, highlighting the pressure Ethereum is under that threatens to disrupt the network.

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Are Investors Cashing In?

Naturally, one might wonder: Why all the rush to withdraw? Given this trend, crypto market analysts believe that ETH holders are eager to take profits and capitalize on the price rally.

For some time, Ethereum has lagged behind BTC and other top cryptocurrencies, including Solana and Cardano in previous bullish phases.

With Ethereum USD prices skyrocketing, those who long-term holding ETH perceive this as an opportunity to secure their profits. As long as prices stay above $4,000, there is a strong motivation to realize profits.

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Is Aave to Blame?

Another angle to consider is that Decentralized finance investors, particularly on lending platforms like Aave, may be reducing their leverage.

Galaxy Digital observes that since mid-July, Ethereum borrow rates on decentralized lending markets, predominantly Aave, surged from below 3% to over 18% in just a few days.

Consequently, users looking to borrow Ethereum and restake it found no economic benefit due to high borrowing rates while Ethereum live protocol yields were comparatively lower.

This closing of the loophole led to a wave of unwinding of Ethereum positions, affecting even Justin Sun who had to withdraw $600 million worth of Ethereum from Aave.  

Currently, Aave Ethereum borrow rates have stabilized below 3%, yet it hasn’t halted the ongoing unstaking from validators.

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The post Ethereum Validators Unstake Over $3.6 Billion, ETH USD Falls: What’s Going On? appeared first on 99Bitcoins.