Citigroup has increased its 12-month price targets for bitcoin and ether, pointing to stronger cryptocurrency activity and renewed investment flows into exchange-traded funds as signs of support for the digital-asset market.
The brokerage raised its bitcoin target to $113,000 from $82,000 and increased its ether forecast to $3,028 from $2,240.
Citi expects cryptocurrency investment flows to return at a slower but more consistent pace as financial advisers and brokerages gradually expand their allocations to bitcoin. The brokerage forecasts $5 billion in crypto inflows over the next 12 months.
The revised outlook follows strong gains for bitcoin and ether during the previous three months. Citi said bitcoin had climbed nearly 40%, while ether rose 68%, bringing their respective year-to-date losses down to about 4% and 9%.
Bitcoin had also increased 40% from its July lows, according to the brokerage. Citi attributed the renewed momentum to a weaker U.S. dollar and the U.S. Treasury’s recent decision to buy back longer-dated bonds.
Regulatory developments remain a significant consideration for the cryptocurrency market. The U.S. Senate failed the previous week to advance the Clarity Act, legislation designed to create a regulatory framework for digital assets.
Citi said the bill’s failure reduced the prospects for a broader market-structure law. However, the brokerage noted that announcements of rules from the Securities and Exchange Commission had helped ease negative sentiment.
Institutional participation has become an increasingly important influence on cryptocurrency markets, particularly through ETFs and other investment products that give traditional investors exposure to digital assets.
Citi’s projections assume that advisers and brokerages will continue increasing their allocations, although at a more measured pace than during periods of rapid crypto inflows.
The updated targets also come as investors assess broader financial conditions. Cryptocurrency prices have reacted in recent months to changes in the dollar, interest-rate expectations, Treasury markets and overall investor risk appetite.
Citi’s revised estimates consequently place greater weight on the combination of market activity, ETF flows and the broader macroeconomic environment rather than cryptocurrency demand alone.
The new bitcoin target represents a significant increase from Citi’s previous $82,000 forecast, while its ether target has risen from $2,240 to $3,028.
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