Ethereum validators observe unprecedented consecutive drops in network involvement

On Apr 11, 2023

Quick Take

Ethereum Shanghai upgrade occurs tomorrow, and the market is indecisive about the potential implications of the price of Ethereum in the short term.
When analyzing the change in active validators, we see back-to-back negative adjustments for the first time.
In the past two days, we have seen over 1,000 active validators exit; a queue system regulates changes in the number of validators per epoch to ensure smooth network operation.
There are still over 560,000 active validators — which has rapidly grown since the merge in September 2022.
Validators are essential to the network’s security; any drop in validators can cause potential security implications.
While the participation rate dropped below 99% for only the third time this year, the participation rate is defined as a measure of network validator responsiveness, tracking the proportion of slots missed to the total available. The participation rate is calculated as (Total Slots – Slots Missed) / Total Slots.

Validators: (Source: Glassnode)

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