Tom Lee's Ethereum Bull Thesis Slammed As 'Financially Illiterate'

Ethereum ETH/USD is down 10% over the past month, raising questions about its near-term upside and the validity of Tom Lee’s lofty upside targets.

What Happened: Mechanism Capital founder Andrew Kang argued on X that Lee's Ethereum thesis is deeply flawed and “financially illiterate.”

Kang underpins his rebuttal with the following arguments:

Stablecoin & RWA adoption: Ethereum fees haven't scaled proportionally to growing transaction volumes, as network activity shifts to other chains like Solana SOL/USD and Arbitrum ARB/USD.
Digital oil comparison: ETH may resemble a commodity, but this is not inherently bullish. Historical commodity price behaviour shows long periods of range-bound trading.
Institutional staking: No major banks have bought or announced plans to buy Ethereum for staking or network security, making this assumption unrealistic.
Valuation versus financial infrastructure: Expecting Ethereum to equal the value of all financial infrastructure is a misunderstanding of value accrual.
Technical analysis: Charts suggest Ethereum remains in a multi-year trading range, with recent price action failing to break resistance. Parabolic rallies are not guaranteed to continue.

Kang concludes that Ethereum's valuation largely relies on macro liquidity and speculative belief, and without major structural changes, ETH may underperform and remain range-bound.

Also Read: Bitcoin, Ethereum, XRP, Dogecoin Hold Steady On Soft Upside Momentum

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