Does Ethereum spot ETF have limited influence? Andrew Kang: It may fall to $2,400 after passing

This site (120btC.coM): When will the Ethereum spot ETF be approved for listing by the U.S. Securities and Exchange Commission (SEC)? The market is paying close attention to the progress of the S-1 registration statement document. On the evening of June 21, Bloomberg ETF analyst Eric Balchunas announced a total of 8 Ethereum spot ETF applicants and reiterated that July 2 will be the launch date of the Ethereum spot ETF.

Bitcoin ETFs provide many new buyers with the opportunity to allocate Bitcoin in their portfolios, allowing Bitcoin prices to rise significantly. Since BlackRock submitted its application for the Bitcoin ETF, the price of Bitcoin was approximately US$25,000. Today, the return rate of Bitcoin has reached 2.6 times. Will the Ethereum ETF further push up the price of Ethereum after it is approved?

Andrew Kang: Ethereum ETF has limited influence

Regarding future price rise predictions, Andrew Kang, co-founder of Mechanism Capital, expressed a conservative view today (23rd). He pointed out that compared with Bitcoin, Ethereum ETF The influence appears to be relatively limited. Even Ethereum’s return reached 2.1x during the same cycle, but this is not significant enough compared to Bitcoin’s gains.

“Judging from the bottom of this market cycle, both Bitcoin and Ethereum have returned 4.0 times. This shows that Ethereum has performed well during the market recovery period, but its potential upside still needs further observation. .”

He believes that the key to judging how much upside the Ethereum ETF can provide lies in whether Ethereum can develop innovative ways to improve the economy. If Ethereum can achieve significant breakthroughs at the technical and application levels, its upside potential will be even greater. On the other hand, if effective economic improvement methods cannot be found, its upside potential will be limited.

ETH may fall to $2,400 after ETF launch

According to estimates by Eric Balchunas, Ethereum’s market flow may be only 10% of Bitcoin’s. This means that in 6 months, Ethereum’s true net purchase flow is expected to be $500 million, and the net flow will be $1.5 billion.

Andrew Kang’s personal prediction for this is that the ETF market for Ethereum is about 15% of the market flow of Bitcoin, that is, a real net purchase volume of US$840 million and a net flow of US$2.52 billion.

“In an optimistic scenario, the Ethereum ETF’s true net purchases could reach $1.5 billion, with reported net flows of $4.5 billion, which is equivalent to 30% of Bitcoin market flows. In either case, true net purchases The volume is still much lower than the derivatives flow of the ETF before the launch, which reached $2.4 billion in advance (meaning that the expectations and reactions of the ETF have been reflected in the price in advance)"

The expected trading price of ETH before the launch of the ETF. Between $3,000 and $3,800; and after the ETF launch, Andrew Kang predicted a price between $2,400 and $3,000. It is worth mentioning that Andrew Kang also said that everything still depends on Bitcoin. If Bitcoin rises to $100,000 at the end of 2024 or early 2025, this may push ETH to a record high, but the ratio of ETH/BTC will be smaller. Low.

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