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Citi has set 12-month price targets of $181,000 for Bitcoin and $5,400 for Ethereum,
while also anticipating moderate growth through the end of this year—reaching $132,000 and $4,500, respectively.
Analyst Alex Saunders noted in a report that further growth next year should be driven by investor demand, even though both tokens are already trading above levels suggested by metrics based on user activity.
Citi expects the favorable environment for capital inflows to persist as institutional investors and financial advisors increase their cryptocurrency allocations—a trend supported by a positive regulatory climate, particularly in the US.
"The macroeconomic backdrop presents mixed signals: expected positive equity returns over the next 12 months are offset by forecasts of a strengthening dollar and, in the case of Bitcoin, a decline in gold prices," the bank's report states.
Citi favors Bitcoin over Ethereum, citing its larger market capitalization, longer track record, and clearer "digital gold" narrative, which is expected to capture a larger share of new investment flows.
Bitcoin is currently trading above the $83,000 valuation suggested by Citi’s adoption model (which ranges from $70,000 to $95,000), a trend driven by ETF inflows and regulatory developments. A bearish scenario envisions a recession and a weakening stock market, whereas a bullish scenario anticipates even stronger capital inflows. Citi noted that forecasts for Ethereum are subject to significant uncertainty due to the difficulty of modeling user activity and estimating the portion of value generated by Layer-2 networks. Even moderate buying can significantly move the price.
"Fund flows remain a key factor explaining return variance: flows into Bitcoin account for 42% of the variance in returns. Flows into ETH ETFs have less explanatory power (18%) but exert a more significant impact on the price," the bank added.