Sassano Counters Ethereum Unstaking FUD After Kiln Exit

• Ethereum validator exit queue tops 2M ETH, driven mainly by Kiln Finance’s withdrawal
• Sassano says unstaked ETH will likely be restaked with other validators, not sold
• ETH price consolidates near $4,300 as analysts warn of a retest below $4K

The Ethereum validator exit queue has surged past 2 million ETH, a sharp rise from just 808,000 validators in the entry queue. Ethereum currently has more than 1 million active validators with over 35.6 million ETH staked, accounting for nearly 29.4% of the circulating supply.

This spike triggered speculation that large-scale unstaking could signal broader selling pressure, raising concerns in the market.

Related: Ethereum Outlook 2035: Is ETH Too Big to Fail or Too Centralized to Last?

Sassano Links Exit to Kiln Finance

Ethereum educator Anthony Sassano, founder of The Daily Gwei, countered that the move is not a sign of network weakness. Instead, he pointed to Kiln Finance, an institutional staking provider, which is voluntarily exiting its validator program.

Sassano explained that Kiln’s decision to pull 1.6 million ETH explains most of the rise in the exit queue. He added that most of the ETH will likely be moved to other validators rather than sold, minimizing risk of a mass liquidation.

Why Kiln Finance Is Unstaking

Kiln Finance announced Tuesday that it is unstaking all its Ether following the recent Solana (SOL) incident involving SwissBorg. On Monday, the SwissBorg crypto platform announced that its partner API, likely Kiln Finance, was compromised resulting in the loss of 193k SOL, valued at over $42 million.

In response, Kiln paused operations and opted to return all ETH to customers while redesigning its validator framework.

Kiln CEO Laszlo Szabo said the exit was the “responsible step to protect stakers,” emphasizing that the process is being closely monitored to preserve fund security.

ETH Price Holds in Tight Consolidation

Despite the validator exits, Ethereum’s price has remained in consolidation between $4,262 and $4,493 for nearly two weeks, after setting an all-time high on August 24, 2025. ETH’s fully diluted market value now sits at roughly $522 billion.

According to crypto analyst Benjamin Cowen, the ETH/USD pair will likely drop further until it retests the 21-weekly EMA. As such, Cowen believes that the ETH price will likely drop below $4k again before rallying towards its price discovery later this year.

Related: Ethereum Holds Above $4,300 as $4,250 Support Becomes Crucial

Historically, the Ethereum price has suffered more bearish Septembers than bullish, thus solidifying Cowen’s midterm correction model. However, crypto analyst alias Micro2Macr0 noted that the ETH/USD pair has strong technicals above $4.2k to fuel the next bull rally.