Citigroup slashed its 12-month price targets for bitcoin and ether on Tuesday, attributing the downgrade to collapsed ETF inflow forecasts and stalled legislative progress on crypto regulation in the U.S.
The bank had previously modeled significant inflows into spot bitcoin and ether ETFs through the end of 2026. Those forecasts are no longer operative. The shift reflects a harder read on institutional appetite after months of weak investor demand and no material movement on federal crypto policy.
Citi did not publicly specify new price levels, but the move signals a pullback from earlier bull-case positioning tied to ETF demand. The bank's original forecasts assumed continued institutional adoption driven by ETF vehicles and a more permissive regulatory environment. Neither has materialized at expected pace.
U.S. crypto legislation has languished despite industry lobbying. Multiple bills aimed at clarifying SEC and CFTC jurisdiction, streamlining staking rules, and easing compliance pathways remain stalled in Congress. Without legislative clarity, major institutions face friction in allocating to crypto assets, dampening the demand signals that had underpinned Citi's earlier models.
Bitcoin traded near $61,811 at publication, down from peaks earlier in 2024. Ether has faced similar pressure. Both assets remain volatile and exposed to macro shifts in risk appetite, but the absence of fresh institutional capital flows has removed one key tailwind from the bull case.
Citi's move is one data point in a broader recalibration. Institutional investors signaled early this year that ETF allocations would grow steadily; instead, flows have been episodic and modest. The mismatch between supply (new ETF products) and demand (capital) has forced analysts to reassess what realistic inflows look like absent regulatory tailwinds or a sharp shift in macro conditions.