Celsius’ $800M ETH Staking Extends Ethereum Queue

Bankrupt crypto lender Celsius Network has made an $800 million ether (ETH) staking move that has caused significant delays in the Ethereum validator queue. The company deposited $745 million of ETH into staking contracts in just two days, adding to the already long waiting time to deploy new validators on the Ethereum network.

Celsius Ethereum Staking

Celsius is reshuffling its staked ETH holdings after Ethereum’s Shanghai upgrade allowed withdrawals from staking contracts. This strategic shake-up has caused the queue to stretch to 44 days, with Celsius potentially adding nearly a week of delay, according to Tom Wan of 21Shares.

Previously, Celsius held 460,000 ETH ($870 million) staked with Lido Finance and deployed 160,000 tokens ($300 million) in their own staking pool.

CoinGape reported that it has reportedly withdrawn 428,000 staked Ethereum (stETH) valued at $780 million.

Bankrupt Crypto Lender Case

The reshuffling of staked assets coincides with Celsius’ ongoing efforts to restructure following a bankruptcy protection filing in July. The company faced liquidity issues due to plummeting cryptocurrency prices and a surge in user withdrawals.

Recently, the U.S. bankruptcy court auctioned off Celsius to Fahrenheit, an investment group backed by Arrington Capital, which will take over the lender’s assets, including institutional loan portfolio, staked cryptocurrencies, and crypto mining units.

Read Former Celsius CEO’s 1B Plan…

Celsius Network on May 25 announced the completion of the auction process to transfer the assets to crypto consortium Fahrenheit LLC.

Even after these transfers, Celsius’ wallets still hold around $109 million worth of ETH, according to data from Arkham. However, this influx of staking activity has further strained the Ethereum validator queue, which was already burdened with increased demand since the activation of the Shanghai upgrade on April 12.

Deposits have exceeded withdrawals by nearly $5.5 billion, leaving new participants with a month-long wait to set up validators, according to blockchain intelligence firm Nansen.