Citi raises its forecasts for Bitcoin and Ethereum due to high activity in the cryptocurrency market

Reuters, October 1 - Citigroup has raised its 12-month forecasts for Bitcoin and Ethereum, citing increased activity in the cryptocurrency market, favorable macroeconomic conditions, and a recovery in ETF inflows.

The brokerage raised its target price for Bitcoin BTC= from $82,000 to $113,000, and for Ethereum ETH= from $2,240 to $3,028.

• In a report released on Wednesday, Citigroup said that as financial advisors and brokers gradually increase their allocation to Bitcoin, inflows into cryptocurrency are expected to resume at a slower but more stable pace.

• The brokerage also predicted that $500 million in funds will flow in over the next 12 months.

• Last week, the US Senate failed to advance the Clarity Act (link), which aims to establish a regulatory framework for digital assets, marking a setback for the entire industry.

• “Although the failure of the Clarity Act has narrowed the likelihood of a market structure bill passing, it prompted the US Securities and Exchange Commission (SEC) to issue a regulatory rule notice, easing negative market sentiment,” Citigroup stated.

• Over the past three months, Bitcoin and Ethereum have risen nearly 40% and 68% respectively, narrowing their year-to-date declines to about 4% and 9%.

• After several consecutive months of underperforming the broader risk asset market, Bitcoin has rebounded 40% from its July low following the recent US Treasury (link) buyback of long-term bonds that caused the dollar to weaken, reviving the overall upward momentum in the cryptocurrency market.

  
  

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