Ethereum

Celsius

April

Beacon

Shockwaves

Celsius Network, a now-defunct cryptocurrency lending platform, has sparked controversy by making changes to its Ethereum (ETH) staking strategy, further worsening the already lengthy waiting list for activating new validators on the Ethereum network.



Within a span of two days, Celsius moved ETH into staking contracts after redeeming approximately $813 million worth of staked ETH from Lido Finance. 



As per data provided by Arkham Intelligence, the company has deposited $745 million worth of ETH since the beginning of June.



Tom Wan, an analyst at 21Shares, a crypto investment product manager, pointed out that these transfers have intensified the already extended queue for establishing new validators on the Ethereum network. 



Wan stated, &#8220;If Celsius decided to stake all the 428k ETH, it would take 45 days and 4 hours to clear the entire activation queue. Essentially, this would add 6 days and 15 hours to the existing queue.&#8221;



The current waiting period for establishing new validators on the Ethereum network has reached 44 days, and it is anticipated that Celsius&#8217;s actions could extend this by nearly another week.



The recent transactions by Celsius are a result of the lender reorganizing its staked ETH holdings since the implementation of Ethereum&#8217;s Shanghai upgrade, which allowed withdrawals from staking contracts in April. 



Prior to this, Celsius had around 460,000 ETH (worth $870 million) staked with Lido Finance, and approximately 160,000 tokens (about $300 million at current prices) deployed in its own staking pool.



These transfers took place during Celsius&#8217;s restructuring phase, which began after the company filed for bankruptcy protection in July and was subsequently acquired by Fahrenheit, an investment group supported by Arrington Capital.



In mid-May, Celsius staked approximately $75 million worth of ETH through the Figment staking service. On-chain data reveals that the significant transfer from Celsius to Figment occurred in fourteen separate transactions between May 10 and 12, totaling around 40,928 ETH.



As of now, according to data from Arkham, Celsius has staked about $199 million of ETH via Figment and deposited approximately $12 million into the Celsius staking pool. 



After the transfers, Arkham estimates that Celsius&#8217;s wallets still hold approximately $109 million worth of ETH.



In other words, Celsius&#8217;s recent actions have further strained the already congested queue of individuals seeking to add new validators on the Ethereum network.



In a proof-of-stake blockchain like Ethereum, validators play a crucial role in ensuring network security and overseeing transactions in exchange for rewards obtained by staking tokens.



It is worth noting that the demand for staking has surged significantly following the implementation of the Shanghai upgrade, which introduced the capability to withdraw staked ETH from the Beacon Chain, activated on April 12.



Data provided by blockchain intelligence firm Nansen reveals that while withdrawals have increased, deposits have risen by nearly $5.5 billion. 



Consequently, new participants are now facing a waiting period of approximately one month to establish validators.



The collapse of Celsius Network in the summer of 2022, during the market downturn that affected most major cryptocurrencies, is believed to have been partially caused by its inability to withdraw the ETH it had staked and locked through providers like Lido Finance. 



This was compounded by depositors rushing to withdraw their funds from Celsius.
The post <a rel="nofollow" href="https://www.unlock-bc.com/102857/celsius-network-unleashes-shockwaves-in-market-stretching-ethereum-validator-queue-to-51-days/">Celsius Network Unleashes Shockwaves in Market, Stretching Ethereum Validator Queue to 51 Days?</a> appeared first on <a rel="nofollow" href="https://www.unlock-bc.com">UNLOCK Blockchain</a>.

Celsius Network Unleashes Shockwaves in Market, Stretching Ethereum Validator Queue to 51 Days?

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