Citi Boosts Bitcoin and Ether Price Targets Amid Crypto Market Recovery

Citi has significantly raised its 12-month price targets for bitcoin and ether, signaling renewed confidence in the crypto market. The bank now expects bitcoin to reach $113,000, up from its previous target of $82,000, and ether to hit $3,028, an increase from $2,240. This upgrade comes as crypto inflows return, with about $5 billion anticipated over the next year, driven by financial advisers and brokerages gradually increasing their bitcoin allocations.

The bank's optimism is tempered by recent regulatory developments. The failure of the Clarity Act in the US Senate narrowed the path for digital asset market legislation, but rule announcements from the Securities and Exchange Commission helped alleviate some negative sentiment. Despite this setback, crypto prices have shown strong recovery, with bitcoin gaining nearly 40% and ether about 68% over the past three months, reducing their year-to-date losses to roughly 4% and 9%, respectively.

Citi's forecasts suggest a stronger upside for bitcoin compared to ether, with implied gains of about 31% for bitcoin and 11% for ether. This contrast is notable given ether's recent outperformance. The bank's outlook remains dependent on macroeconomic factors, particularly the strength of the dollar and Treasury yields, which could impact the steady ETF inflows that underpin Citi's projections.

While Citi's bullish stance on crypto adds tier-one support to the market's recovery, it also highlights the importance of weekly flow data as a key signal. The differing upside targets may shift relative positioning between bitcoin and ether, with bitcoin potentially benefiting more from new institutional inflows.