Citigroup sharply lowered its 12-month forecasts for Bitcoin and Ethereum, stating that weakening investor appetite, negative flows into exchange-traded funds (ETFs), and the lack of progress on U.S. digital asset regulations have worsened the outlook for the two largest cryptocurrencies.

Bitcoin reached $58,864.27 earlier today, its lowest since September 2024 and half its all-time high of $126,223.18 reached in October last year. Ethereum was at $1,585.63, its lowest since April 2025. Cryptocurrency markets have struggled this year amid heightened volatility, investor excitement surrounding anticipated major IPOs, and sustained outflows from asset-tracking ETFs.

Both cryptocurrencies are trading below their long-term moving averages, reflecting bearish sentiment. Citi's pessimistic scenario, assuming an economic recession and continued ETF outflows, values ​​Bitcoin at $53,000 and Ethereum at $1,094 over the year.

Citi noted that the revision was prompted by its decision to lower its 12-month net ETF inflow forecast to zero from $10 billion.

"ETF flows, an important price driver, have recently turned negative," the note stated, with Bitcoin ETF outflows totaling approximately $3.3 billion year-to-date.

The brokerage expects broader investor adoption of cryptocurrencies to remain on hold until a new catalyst emerges. Citi also noted that slow progress on US cryptocurrency regulations and concerns about potential Bitcoin sales by companies holding digital assets in reserves have hit investor sentiment, with the weakness coinciding with a shift of funds into AI-related assets.