ETH Staking Withdrawal Queue Hits New High as Market Focuses on Powell’s Jackson Hole Speech
Cryptocurrency Market Overview
After experiencing a decline over the weekend, the cryptocurrency market has returned to a market capitalization of $4.01 trillion, with the Fear and Greed Index falling back to a neutral range of 57. Recently, ETH has yet to reach new all-time highs; however, there are currently as many as 890,000 ETH (approximately $4 billion) waiting to be unstaked, and analysts warn this could impact ETH’s pullback. This week, the market will focus on the global central bank meeting in Jackson Hole, particularly Powell’s speech on Friday.
Jackson Hole Approaches, Market Focuses on Powell’s Speech
The global central bank meeting will be held from August 21 to August 23 in Jackson Hole, with Federal Reserve Chairman Powell scheduled to deliver a speech at 10 AM Eastern Time on Friday (August 22), which will be 10 PM in Taiwan. This may be one of the most significant speeches of his career.
The market believes that a 25 basis point rate cut next month is virtually a done deal, with at least one more cut expected before the end of the year. In recent years, Powell has often taken this opportunity to issue market-impacting policy statements, and this occasion may hold particular significance.
Prior to this, the Federal Reserve’s meeting minutes will be released on Wednesday, and several Fed officials, including Michelle Bowman, Christopher Waller, and Raphael Bostic, will also be making statements.
ETH Fails to Reach ATH, Unstaking Queue Hits New High
After experiencing a decline over the weekend, the cryptocurrency market has returned to a market capitalization of $4.01 trillion, with the Fear and Greed Index falling back to a neutral range of 57. As BTC’s dominance decreased to 58.55%, the altcoin season index rose to 47, with ETH, BNB, and SOL all seeing weekly gains of over 5%, while ADA and LINK experienced increases of around 20%.
ETH has recently failed to challenge its all-time high. According to data from validatorqueue.com, there are currently up to 890,000 ETH (approximately $4 billion) waiting to be unstaked, setting a new record in the history of the network, with waiting times extending to 15 days.
Juan Leon, a senior investment strategist at Bitwise, believes that this increasing number could drive ETH’s pullback, especially if the trading price of staked ETH falls below ETH itself.
“Tokens like stETH can trade at a discount. This discount reduces their value as collateral, triggering risk reductions, hedging, or even liquidations, leading to spot ETH sales. If the cost of borrowing ETH skyrockets, leveraged stETH circular trades conducted through DeFi liquidity pools will no longer be profitable, prompting traders to close positions and sell ETH to repay loans, thereby creating synchronous selling pressure.”
Unfavorable Financial Reports Due to Staked ETH; DAT Companies Face Challenges
SharpLink, an American Ethereum reserve company, reported its second-quarter earnings last Friday, citing a non-cash impairment loss of $87.8 million due to the accounting recognition of liquid staking ETH (LsETH). This accounting method necessitating low-price recognition of staked ETH will also present adverse factors for reserve companies like Ethereum and SOL that claim to earn additional income from staking. Following the decline in coin prices on Friday, the stock prices of various digital asset companies (DAT) fell sharply.
Risk Warning
Cryptocurrency investments carry a high degree of risk, and their prices can be extremely volatile. You may lose your entire principal. Please assess risks carefully.
