Ethereum’s Staking Backlog Hits 71 Days as $174M Short Squeeze Shakes Market
Published on 06/16/2026 at 04:43 | Redaktion boerse-global.de
A sudden ceasefire between the US and Iran sparked a violent rally in Ether on Wednesday, sending the token nearly 10% higher to $1,840 and triggering a cascade of forced liquidations. Within 24 hours, exchanges unwound positions worth $174 million, with short sellers bearing the brunt—almost 90% of those liquidations were bets against the cryptocurrency. The squeeze proved fleeting, however; Ether has since eased back to $1,789.75, extending its year-to-date loss to 40.35%.
The price action masks a deepening disconnect between market sentiment and on-chain activity. While US-listed spot ETFs continue to bleed capital, validators are piling into Ethereum’s staking system at an unprecedented rate. The queue for new staking deposits now exceeds 4 million Ether, valued at roughly $7.3 billion at current prices. That compares with just 267,000 Ether waiting to be withdrawn—a ratio of more than 15-to-1. The bottleneck has pushed the estimated wait time for new validators to 71 days, up from 50 days just days earlier when the queue stood at under 3 million tokens.
One institutional player is single-handedly amplifying the congestion. Bitmine Immersion Technologies now controls nearly 5% of all circulating Ether after buying roughly 77,000 tokens last week, funded by a $136 million capital raise. The firm has staked over 4.7 million of its holdings in the network, generating projected annual staking rewards of $219 million. Trading in Bitmine’s new preferred shares begins today on the New York Stock Exchange.
Should investors sell immediately? Or is it worth buying Ethereum?
The surge in staking demand tightens the available supply on exchanges. Each new validator must lock up 32 Ether, removing those coins from free circulation. With the withdrawal queue nearly empty, the risk of a sudden wave of selling from exiting validators is minimal. “A shrinking liquid supply colliding with a market trading well below its 200-day moving average of $2,402.17 sets up a curious dynamic,” one analyst noted. The split is stark: ETF investors are reducing exposure, while on-chain participants are committing capital for the long haul through proof-of-stake.
The short squeeze itself was fueled by leveraged whales. A well-known market participant used loans to fund multi-million-dollar purchases during the prior weakness, while another holds a long position of over 40,000 Ether that faces liquidation if the price falls below $1,347. Despite the rally, the technical picture remains bearish: the next resistance sits at the 50-day moving average near $2,071.
Looking further ahead, the Glamsterdam upgrade slated for the third quarter of 2026 promises to slash network fees by roughly 80% and boost throughput to 10,000 transactions per second. For now, however, Ethereum’s dual narrative—institutional outflows versus retail and whale accumulation—keeps the market guessing which force will ultimately prevail.
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