Ethereum experiences its first wave of validator exits since transitioning to PoS

ChainCatcher reports that the number of Ethereum validators has decreased by approximately 10% since July, falling back to April 2024 levels. This is the first sustained withdrawal of validators since transitioning to the proof-of-stake mechanism.
As of November 11, the number of active daily Ethereum validators has dropped below 1 million for the first time since April 28, currently standing at 999,203. The withdrawal queue waiting time has reached a record high of 17.6 days, while the validator onboarding waiting time has surged to 22 days, with about 1.2 million ETH waiting to be staked.
Clemens Scarpatetti, CEO of CryptoCrew Validators, stated that the decline in active validators reflects a mix of cyclical and structural factors, including long-term stakers taking profits after strong performance in Q2 and Q3 of 2023, as well as large-scale withdrawals from liquid staking providers like Lido.
A significant factor is also the decline in staking yields. At the time of writing, the annualized staking yield for Ethereum is approximately 2.9%, sharply down from a record 8.6% in May 2023. Meir Rosenschein, Product Director at DcentraLab, noted that the decrease in staking yields and rising borrowing costs make leveraged staking unprofitable.
Dune data shows that the decentralized staking protocol Lido leads the market with over 84 million ETH staked, accounting for more than 23%. Binance and Coinbase hold approximately 9.2% and 6.5% of staked ETH, respectively.