V defends the Ethereum mechanism! ETH surged overnight, breaking through $4,600, and a large number of short positions were liquidated.

Ethereum (ETH) price strongly rebounded above $4,600 on September 19, as market confidence clearly restored after co-founder Vitalik Buterin publicly defended its controversial validator queue mechanism. Despite up to 2.48 million ETH (approximately 7% of the total staked amount) currently waiting to be withdrawn, with wait times soaring to 43 days, Buterin remained firm that this design is crucial for network security, triggering a strong market reaction, with short positions facing $37.4 million in liquidations within 24 hours.

Vitalik Buterin responds strongly: The validator queue is key to Ethereum's security

Ethereum co-founder Vitalik Buterin recently made a strong rebuttal to criticisms surrounding the validator queue mechanism. He stated clearly on social media platform X that, while the current design is not perfect, it plays an irreplaceable role in strengthening network trust, especially for less active investors.

“Staking is a key responsibility to ensure the security of the blockchain. Fulfilling the obligation requires a certain level of friction. If either party can withdraw at any time, the army cannot maintain its strength,” Buterin wrote on X on September 17.

He admitted that the current mechanism is not the most optimal, but emphasized that if parameters are simplified or relaxed, the stability and reliability of the network would be severely affected, especially from the perspective of intermittent nodes. At the time of this statement, according to data from the Validator Queue, the waiting time for staking withdrawals has skyrocketed to 43 days, with 2.48 million ETH waiting to exit, accounting for about 7% of the total staked amount of 35.6 million ETH.

Expert Opinion: The Queue Mechanism is a Necessary Security Guarantee

Figment senior analyst Benjamin Thalman stated that the current large-scale withdrawals will not affect the daily operations of Ethereum. “Ethereum is operating as designed. Limiting the entry and exit rates of validators is an important security measure,” he emphasized.

Thalman added that most of the ETH exiting the queue may soon be restaked through new validators, which could put further pressure on the queue in the near future.

Sygnum analysts also agree, believing that the recent surge in stake withdrawals mainly reflects investors repeatedly rebalancing their portfolios, rather than large-scale profit-taking.

ETH Price Technical Analysis: Strong Rebound from the 20-Day Moving Average

(Source: Trading View)

According to Coinglass data, in just the past 24 hours, the Ethereum market has seen $59.8 million in futures liquidations, with $37.4 million coming from short positions, indicating a clear shift in market sentiment towards bullish.

ETH has rebounded strongly for two consecutive trading days from the simple moving average (SMA) on the 20th and successfully broke through the resistance level of $4,500. This breakout momentum is due to the resurgence of risk appetite following the Federal Reserve's (Fed) decision on Wednesday to cut interest rates by 25 basis points again.

However, the largest altcoin in the market is still facing strong selling pressure around the resistance level of $4,670. Technical analysis shows:

· If the price closes above $4,670, ETH may continue its upward momentum, targeting a challenge at the $4,835 level.

· If a pullback occurs, the $4,300 to $4,400 range will become important support, reinforced by the 20-day and 50-day SMA lines.

· The Relative Strength Index (RSI) and the Stochastic Oscillator remain above neutral levels, indicating that the bullish trend still dominates.

Controversies and Defenses of the Ethereum Validator Queue Mechanism

The Ethereum staking/validator queue mechanism is designed to limit the amount of ETH that can be deposited or withdrawn at one time, thereby maintaining the stability of the Ethereum proof-of-stake consensus model. However, compared to other Layer 1 blockchains, this long queuing mechanism has been criticized for being overly cumbersome and lacking flexibility.

Supporters compare it to the high-risk withdrawal process of banks—believing it is a necessary part to ensure system security. On September 9, following the NPM supply chain attack and the SwissBorg exchange vulnerability, the Ethereum infrastructure provider Kiln took preventive measures to withdraw all validators, leading to a massive outflow of stakes.