Citi Predicts Bitcoin Could Surpass $189K in a Year Under Optimistic Scenario

In a recent forecast, Citigroup has shared its positive 12-month price predictions for Bitcoin and Ethereum, attributing the expected growth to decreasing regulatory pressures and increasing institutional interest.

Key Takeaways

Citigroup forecasts Bitcoin could reach $143,000 within a year, a significant increase from its current price of approximately $87,976.
Ethereum is predicted to rise to $4,304, from its current value of about $2,958.
The predictions are fueled by improving regulatory frameworks and institutional adoption of digital assets.
Current market volatility and external factors, such as earnings forecasts from key players, could influence these outcomes.
Citi outlines both bullish and bearish scenarios for Bitcoin and Ethereum, estimating potential prices of $189,000 and $78,000, respectively.

Bitcoin

Optimistic Price Outlook for Bitcoin and Ethereum

In a research note released on Thursday, Citigroup set a price target of $143,000 for Bitcoin over the next 12 months, reflecting a bullish outlook for the largest cryptocurrency. At present, Bitcoin is trading around $87,976, suggesting a potential increase of approximately 62% according to the bank's projections. Ethereum is also forecasted to perform well, with a target price of $4,304, which indicates nearly a 46% gain from its current price of approximately $2,958. Together, these forecasts suggest that Citi believes the overall cryptocurrency market is on track for recovery after facing recent downturns.

The Role of Regulatory Developments

Citi emphasizes that regulatory developments will significantly impact market dynamics moving forward. The report notes a shift among financial authorities toward establishing regulations tailored specifically for digital assets. In addition, several legal actions against prominent crypto platforms have been withdrawn, which, according to Citi, could alleviate uncertainties and promote wider adoption along with stronger capital inflows into the sector.

Market Volatility as a Concern

Despite signals of improvement in regulation, recent market volatility has dampened investor sentiment. In November, Bitcoin prices dropped to multi-month lows as investors pulled back from riskier assets. This decline was partly triggered by concerns over high valuations in the tech sector. In December, market sentiment further soured after Strategy, previously known as MicroStrategy, warned that its 2025 earnings forecast would be lowered due to Bitcoin's ongoing weakness. As the largest corporate holder of Bitcoin, this news caught the attention of many investors.

Bullish and Bearish Projections from Citi

Amid ongoing market turbulence, Citi believes that current Bitcoin prices are better aligned with user activity after valuations adjusted following a decline from the highs seen in October. The bank projects that in a bullish scenario, Bitcoin could rise to $189,000, while Ethereum could increase to $5,132. Conversely, in a bearish outlook, Bitcoin may drop to $78,000 and Ethereum could fall to $1,270.

A Long-term Shift in Bitcoin Market Cycles

Citi's forecasts align with insights from brokerage firm Bernstein, which suggests that Bitcoin has transcended its traditional four-year cycle and entered a prolonged bullish market phase. Bernstein reported that despite a 30% price correction, ETF outflows represented less than 5% of total holdings, indicating that investors are remaining committed even amid price fluctuations. Reflecting this confidence, Bernstein raised its price target for Bitcoin to $150,000 by 2026 and projects that the current market cycle could peak around $200,000 in 2027, with a long-term forecast of Bitcoin approaching $1 million by 2033.

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