Citigroup Cuts Bitcoin Target as Wall Street Splits Over Crypto’s Next Phase

Key Highlights

• Citigroup lowered its 12-month Bitcoin target from $143,000 to $112,000
• The bank also reduced its Ethereum forecast due to weaker regulatory momentum
• The downgrade was linked to stalled U.S. crypto legislation and delayed policy clarity
• Other major banks remain divided, with some still maintaining bullish long-term outlooks
• Institutional demand via ETFs remains strong but more sensitive to policy signals
• Analysts say regulation is now the key driver of Bitcoin’s medium-term price direction

Citigroup has lowered its Bitcoin price outlook, cutting its 12-month target from $143,000 to $112,000 as uncertainty around U.S. crypto legislation continues to weigh on institutional sentiment. The revision reflects growing caution across Wall Street as regulatory progress slows and expectations for near-term catalysts weaken.

The bank also reduced its Ethereum forecast, citing similar concerns about delayed legislative clarity and inconsistent momentum in digital asset policy development. Analysts at Citigroup pointed to stalled progress on broader crypto market structure rules as a key reason for the downgrade, noting that regulatory uncertainty is limiting institutional inflows that had previously supported bullish forecasts.

Despite the cut, Citigroup’s updated scenario analysis still includes a wide range of outcomes. In a weaker macro environment, Bitcoin could fall significantly from current levels, while in a stronger adoption scenario driven by ETF inflows and regulatory breakthroughs, the asset could still reach new highs over the next year.

The downgrade comes at a time when other major financial institutions remain divided on crypto’s direction. Some banks continue to maintain long-term bullish projections, arguing that Bitcoin adoption by institutions, sovereign wealth funds, and ETF vehicles remains structurally intact. Others, however, are adopting more cautious stances due to the pace of regulatory development and macroeconomic uncertainty.

A central theme across Wall Street research has become the role of regulation as a primary price driver. With spot Bitcoin ETFs already established in major markets, further upside is increasingly expected to depend on policy clarity, including stablecoin rules, exchange oversight, and clearer definitions of digital commodities versus securities.

Recent developments in Washington, including ongoing debates over crypto market structure legislation, have created a stop-start environment for institutional decision-making. While some progress has been made, disagreements over stablecoin frameworks and enforcement authority continue to delay broader legislative clarity.

Even so, institutional interest in crypto has not disappeared. ETF inflows remain a key source of demand, with large asset managers continuing to expand digital asset exposure products. However, analysts note that these flows are highly sensitive to regulatory headlines and macro conditions, making them less predictable than earlier cycles of retail-driven speculation.

Other major banks have taken different approaches. Some remain optimistic about Bitcoin’s long-term role as a macro asset and store of value, while others have adjusted expectations downward in line with weaker liquidity conditions and slower adoption curves in traditional finance.

Market observers say this divergence reflects a broader transition phase for the crypto industry. Rather than being driven purely by speculation or retail cycles, Bitcoin and major digital assets are increasingly influenced by institutional positioning, ETF demand, and government policy decisions.

Despite the downgrade, long-term outlooks across Wall Street still vary widely. Some forecasts continue to project significant upside over the coming years, particularly if regulatory clarity improves and tokenized financial markets expand. Others warn that without stronger policy catalysts, crypto may remain range-bound for longer periods than in previous cycles.

For now, Citigroup’s revised outlook highlights a key reality shaping the current market: Bitcoin’s trajectory is no longer determined only by technical cycles or halving events, but increasingly by the pace and direction of global financial regulation.