Mechanism Capital Co-Founder: The impact of Ethereum ETF on the market is not as significant as Bitcoin ETF, ETH has limited upside potential

ChainCatcher news, Andrew Kang, co-founder and partner of the crypto venture capital firm Mechanism Capital, stated on social media that unless Ethereum develops a convincing way to improve its economic situation, the price of Ethereum will not gain much upward space due to the approval of spot ETFs.

He predicts that the fund flow of Ethereum's spot ETFs will be lower than market expectations because the approval of ETFs was unexpected and issuers did not have much time to convince large holders to convert their ETH into ETFs. On the other hand, there is less appeal for holders to convert ETH as they need to give up staking or using ETH as collateral in DeFi.

In addition, Andrew Kang expects that ETH/BTC will continue on a downward trend with a ratio between 0.035 and 0.06 over the next year. Although sample size is small, it should come as no surprise since markets have indeed seen ETH/BTC hit lower highs in each cycle.