Wall Street giant Citigroup has lowered its one-year price forecasts for both Bitcoin and Ethereum.
It cited cooling market momentum, slower regulatory progress in the U.S., and more tempered expectations for ETF inflows.
In a report led by analyst Alex Saunders, the bank revised its projections downward. Specifically, the bank now expects Bitcoin to reach $112,000 within 12 months, down from a previous estimate of $143,000. It similarly cut its Ethereum target to $3,175 from $4,304.
Despite these reductions, Citi’s outlook still implies notable upside. At the time of writing, Bitcoin was trading near $74,000, while Ethereum hovered around $2,330. In other words, the bank still sees room for growth, albeit at a more measured pace.
Key Points
- Citi cut its one-year forecasts for Bitcoin to $112,000 and for Ethereum to $3,175, citing slowing momentum and regulatory delays.
- ETF inflows remain critical, with Citi projecting $10B for Bitcoin and $2.5B for Ethereum over the next year.
- U.S. regulatory uncertainty persists; the CLARITY Act has passed the House but is stalled in the Senate.
- Momentum in Bitcoin and Ethereum has weakened since October, with Ethereum underperforming relative to Bitcoin.
- Citi sees both bull and bear scenarios: Bitcoin could rise to $165,000 or fall to $58,000; Ethereum could reach $4,488 or drop to $1,198.
ETF Flows Remain Key, Though Outlook Softens
Even as it trimmed its forecasts, Citi emphasized that ETF inflows remain the primary driver of potential price gains. However, expectations have been recalibrated to reflect a slower pace of demand.
Specifically, the bank now projects approximately $10 billion in Bitcoin ETF inflows and $2.5 billion in Ethereum ETF inflows. According to Saunders, these flows still represent the most significant positive catalyst for the market. He added that ETF demand has held up relatively well, even amid ongoing geopolitical uncertainty.
That said, the crypto market has struggled to regain strong upward momentum. Since Bitcoin’s peak in October, prices have gradually softened, reflecting a decline in risk appetite and waning post-halving enthusiasm. In this environment, ETF inflows have acted more as a stabilizing force than a trigger for sharp rallies.
Regulatory Uncertainty Weighs on Sentiment
Citi also highlighted the pivotal role of U.S. regulation in shaping the market’s trajectory. The report estimates a roughly 60% chance of major crypto legislation passing this year, though the window for action appears to be narrowing.
A central focus is the CLARITY Act, which has passed the House but remains under debate in the Senate. Continued negotiations have added to uncertainty, contributing to a more cautious market tone.
The proposed legislation aims to clarify how digital assets are classified and regulated, and to define the roles of the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). Greater regulatory clarity is widely viewed as essential for boosting institutional participation.
Momentum Fades After October Highs
Beyond regulatory concerns, Citi pointed to weakening market momentum since October’s highs. Several factors have contributed to this trend, including futures liquidations and signs of investor fatigue.
Moreover, prices remain below key technical levels, limiting bullish sentiment. Bitcoin, in particular, appears likely to trade within a defined range in the near term, with $70,000 emerging as a key psychological threshold tied to earlier expectations.
Ethereum, meanwhile, has underperformed relative to Bitcoin. Its weaker showing has been linked to softer on-chain activity, which continues to weigh on demand.
Bull and Bear Scenarios
Given these mixed signals, Citi outlined both optimistic and pessimistic scenarios. In a strong growth environment, driven by increased adoption and ETF demand, Bitcoin could climb to $165,000. Under the same conditions, Ethereum may reach $4,488.
Conversely, a weaker macroeconomic backdrop could lead to lower prices. In a recession scenario, Bitcoin might fall to $58,000, while Ethereum could decline to $1,198.
Overall, Citi’s revised outlook reflects rising risks but not a fundamentally negative stance. While both assets face near-term headwinds, growth opportunities remain.
Ethereum’s outlook appears somewhat more uncertain, largely due to its dependence on network activity. However, longer-term developments in areas such as stablecoins, tokenization, and decentralized finance could provide meaningful support, thus offering a path to recovery if broader conditions improve.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
