Source: Yellow Original Title: Ethereum staking contract surpasses $256 billion with nearly half of supply locked

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Ethereum staking contract surpasses $256 billion with nearly half of supply locked

The Proof-of-Stake deposit contract now holds 77.85 million ETH valued at approximately $256 billion, representing 46.59% of the total cryptocurrency supply after a 38.4% growth over the past year.

The deposit contract serves as the foundation for Ethereum’s security model, holding cryptocurrencies that validators have committed to secure the network through staking.

Market intelligence platform Santiment reported the milestone on Saturday, noting that concentration sometimes leads to misunderstandings about a “whale wallet” that could suddenly dump its holdings on exchanges.

Protocol safeguards preventing rapid withdrawals

Ethereum’s architecture imposes strict speed limits that prevent mass withdrawals, and the protocol limits validator exits to 256 ETH per epoch or approximately 57,600 ETH daily, according to ValidatorQueue data.

Validators requesting to exit must wait in queues that can extend for weeks during periods of high demand, although current exit queue times are only seven minutes, with just 288 ETH pending withdrawal as of early January 2026.

The gradual exit mechanism protects against destabilizing events by ensuring validators cannot flood exchanges quickly, maintaining network security during transition periods.

Divergent market interpretations

Bullish investors interpret the concentrated holdings as a demonstration of long-term confidence among Ethereum users, with actively staked ETH reaching a record of 35.9 million tokens, accounting for 29.6% of circulating supply.

The inbound queue currently contains 1.32 million ETH waiting to be deposited, significantly surpassing the exits and suggesting sustained validator participation despite ETH trading roughly 30% below August 2024 highs, near $4,000.

Critics raise liquidity concerns about potential withdrawal queues if sharp price drops trigger massive validator exits, pointing out that concentrated holdings could create supply shocks when sentiment shifts, despite the protocol’s speed limits designed to prevent these scenarios.

Institutional participation continues to expand, with companies staking over 342,000 ETH in recent weeks and major asset managers integrating staking into exchange-traded products, further concentrating validator control among larger entities.