Ethereum’s stake queues have been emptied and the network can now absorb new validators and exits in near real-time.
This means that the rush to lock ETH is gone for now and the stakes are settling into a steady-state rather than a scarcity trade.
Queues are simply the time spent starting or stopping staking on the Ethereum network, acting as a sentiment gauge and a liquidity gauge.
In a way, the lack of queues is a feature, not a bug, as these are proof that Ethereum can handle stake flows without locking up liquidity for weeks.
At the same time, staking rewards have compressed to 3% as total ETH staked grew faster than issuance and fee revenue, limiting incentives for renewed increases in either direction and leaving queues close to zero even as overall staking participation remains high.
Lower dividends may reflect crowding, but also a higher ‘confidence premium’ — more ETH chooses to invest in the stake rather than on the exchange’s order books.
What this means in plain terms is that “performance pressure” is no longer a daily narrative.
When queues are long, the ETH supply actually gets locked up faster than the network can onboard validators, and this can create a sense of scarcity.
When the queues are close to zero, the system is closer to neutral. People can bet or deposit without waiting weeks, making betting feel less like a one-way door and more like a liquid allocation.
This changes the psychology of ether trading.
Staking still reduces immediate selling pressure, but it’s not the same as coins being stuck. With withdrawals working smoothly, ETH behaves less like a forced lockup asset and more like a yield-bearing position that can be changed when sentiment changes.
Overall, Ethereum’s stake supply is around 30%, well below the 50% predicted by Galaxy Digital by the end of 2025. Expectations held by Galaxy that ETH would sustain prices above $5,500 thanks to staking-induced supply shock and that layer-2s would overtake layer-1s in economic activity failed to materialize.
ETH all-time highs may be some time away
Ethereum’s DeFi TVL stands at around $74 billion, well below its roughly $106 billion peak in 2021, although daily active addresses have nearly doubled over the same period, according to DeFi Llama.
The network still accounts for close to 58% of total DeFi TVL, but that share hides a more fragmented reality.
Incremental growth is increasingly captured by ecosystems like Solana, Base and bitcoin-native DeFi, allowing activity to expand across the Ethereum circuit without translating into the same concentration of value or demand for ETH itself.
That fragmentation matters because Ethereum’s strongest bull arguments used to be simple. More use meant more fees, more burns and more structural pressure on supply.
The 2021 TVL peak was also a leverage era; a lower TVL today does not necessarily mean less use, just less foam.
However, in the current regime, a meaningful portion of user activity may occur on layer-2 networks where fees are cheaper and the experience smoother, but the value capture that accrues back to ETH may be less obvious to spot markets at the moment.
“One way to frame it is that Ethereum has lost directional clarity,” DNTV Research founder Bradley Park shared in a note to CoinDesk. “If ETH is treated primarily as a trust asset to be staked rather than actively used, it weakens the burning mechanism: less ETH is burned, issuance continues, and selling pressure builds over time.”
“Over the past 30 days, Base has generated significantly more fees than Ethereum itself. That contrast raises a more difficult question for Ethereum, whether its current trajectory is adequately channeling usage back into value for ETH,” Park added.
This gap between activity and value creation shows up in the prediction markets.
On Polymarket, traders assign only an 11% chance of ETH reaching a new record high in March 2026, despite higher active addresses and a still dominant share of DeFi TVL.
The pricing suggests that the market views fragmentation and unlimited stake supply as limiting factors, where usage alone is no longer sufficient to force a challenge at the highest level.
But that picture could change quickly if US policy evolves to allow yield-bearing ETH products, a change that would reopen the ‘staking premium’ trade.
