Ethereum
|5 min ReadEthereum staking bottleneck looms as demand converges
Maya Chen
Senior Analyst
Published
Jan 16, 2026
A queue builds, then accelerates
Get in line. That is the message for would-be stakers. As of Sept. 18, the validator entry queue held 422,143 ETH worth $1.94 billion. That is below August’s 986,824 ETH peak, but still near the highest levels since The Merge in September 2022. The shorter wait time, from 16 days to 8, is a head fake. The next surge is coming.
On Sept. 9, staking provider Kiln, which manages about 1.6 million ETH, was hit by a security event. Kiln preemptively exited its ETH. The exit queue jumped from just over 500,000 ETH to more than 2.5 million ETH.
Those tokens come back. When Kiln deems the network safe, it restakes. That wave may collide with three other drivers in the same window. The line will stretch.
Four demand drivers line up for fall
First, digital asset treasuries. If 2024 was the year of ETFs, 2025 is the year of the DATs. Outside Bitcoin, ETH is the main treasury asset. Strategic ETH Reserve data shows Bitmine Immersion, Ether Machine, Sharplink Gaming and others now hold 499,000 ETH worth $22.97 billion. That stash is approaching the 675,000 ETH held by spot ETH ETFs.
For treasury managers, staking turns idle ETH into yield. The Composite Ethereum Staking Rate sits near 2.91% annualized. Chris Perkins of CoinFund likens it to Ethereum’s LIBOR. Fees on liquid staking platforms like Lido or Rocket Pool reduce the take, but the baseline signal is clear.
Treasury buying feeds the queue. Kam Benbrik of Chorus One says a large slice of new staking comes from DATs like Sharplink, which publicly said nearly 100% of its ETH is staked. Bitmine, the largest ETH treasury, has not started staking on chain. When it flips on, it will matter. The pipeline is not empty.
Second, staking ETFs. The SEC delayed decisions from Sept. to October. Bloomberg’s James Seyffart expects mid to late October approvals for structures that allow staking. Alluvial CEO Mara Schmeidt says the blockers are tax and grantor trust mechanics, not the concept. She expects a clear path in October. If those funds stake, inflows will be heavy. The queue will not shrink.
Third, holiday optimism. Q4 has been friendly to ETH. Year to date ETH is up 36.6%. Since April 1 it is up 140.59%. In past cycles ETH returned 142.81% in Q4 of 2017, and 22.59% in Q4 of 2021. If momentum holds, more capital will chase yield and liquidity.
Fourth, Kiln’s return itself. One provider with 1.6 million ETH is not the whole market. The timing is the edge. A single large entrant can stretch wait times when spare capacity vanishes. We just saw an old ICO-era wallet stake 150,000 ETH in early September. That is $646 million in one push. The line moved.
Who benefits if the line gets long
Winners cluster where users find liquidity and higher effective yields. Liquid staking should see the first lift. Lido’s stETH controls about 24% of ETH staking with 37 billion in TVL. It signals steady demand and deep secondary markets. Rocket Pool’s rETH holds 2.8 billion. It leans on greater decentralization through more independent node operators, not just institutions.
Restaking can run hotter. Active validation services borrow security from staked ETH and pay extra yield. Returns around 3.5 to 5.5 percent beat native staking near 2.8 percent. Leaders are visible. EigenLayer sits near 19 billion in TVL. Ether.fi is above 11 billion and has pushed its ETHFI token with product innovation. Renzo’s ezETH holds about $1.5 billion. If restaking inflows grow, protocol tokens like EIGEN, ETHFI and REZ may catch a bid alongside usage.
Here is the bottom line. DATs are buying. ETFs want to stake. Q4 favors risk. Kiln will come back. The queue will swell. If you want the yield, move before everyone else does.
Disclaimer: This document is intended for informational and entertainment purposes only. The views expressed in this document are not, and should not be taken as, investment advice or recommendations. Recipients should do their own due diligence, taking into account their specific financial circumstances, investment objectives and risk tolerance, which are not considered here, before investing. This document is not an offer, or the solicitation of an offer, to buy or sell any of the assets mentioned.