Citi Raises Bitcoin Target to $113,400, Expects $5 Billion in Crypto Inflows

Citi, a prominent banking giant, has reversed its earlier bearish stance on Bitcoin and has increased its price target to $113,400. This new target is a significant 40% increase from its previous prediction of $82,000, made in July when the market was experiencing a downturn. The bank's analysts cited stronger cryptocurrency activity, a more supportive macroeconomic environment, and the return of ETF inflows as key reasons behind the new target.

Citi also expects around $5 billion in crypto inflows over the next year, with financial advisers and brokerages gradually increasing BTC allocations. The bank acknowledged the recent failure of the CLARITY Act in the Senate but argued that the subsequent announcements from the SEC and the CFTC helped soften the negative impact on sentiment.

Furthermore, the change in Citi's outlook for Bitcoin has had a significant impact on its Strategy valuation. The bank's analysts had previously highlighted a MSTR price target of $136, but now the target has been increased to $240. Citi has maintained a 'buy' rating on MSTR, with roughly 34% of the projected upside contribution coming from further BTC appreciation.