Citigroup has lowered its Bitcoin and Ethereum price forecasts, citing regulatory delays and reduced ETF inflows as key factors.
Citigroup has revised its Bitcoin price forecast for the year, lowering it from $143,000 to $112,000, while also reducing its Ethereum projection from $4,304 to $3,175, as detailed in a recent bank report.
Analyst Alex Saunders attributed these adjustments to several factors, including a slowdown in U.S. regulatory developments, decreased on-chain activity, and diminished expectations for capital inflows into exchange-traded funds (ETFs). The bank now estimates annual demand for spot Bitcoin ETFs at $10 billion and for Ethereum-based funds at $2.5 billion, although Saunders still sees inflows into these ETFs as crucial for market growth.
Citigroup has outlined potential scenarios for the market: in a bullish case with widespread ETF adoption, Bitcoin could reach $165,000 and Ethereum could rise to $4,488. Conversely, in a bearish scenario influenced by a macroeconomic downturn, Bitcoin might fall to $58,000 and Ethereum to $1,198. For Ethereum, additional risks are present due to weak network activity, though growth in the stablecoin market could offer some support.
Market Resistance Levels for Bitcoin
Julio Moreno, head of research at CryptoQuant, noted that Bitcoin may encounter resistance between $75,000 and $85,000. Despite positive trader sentiment ahead of the Federal Reserve meeting, Moreno highlighted that if the price rally continues, the initial resistance level will be at $75,000, which has historically acted as a barrier during bear markets.
The perpetual futures market currently shows a predominance of long positions, indicating investor confidence, but also a potential risk as Bitcoin inflows to exchanges have surged. On March 16, hourly deposits reached 6,100 BTC, the highest volume since February 20, with a significant portion being large transfers, which could create selling pressure.
Positive Trend for Ethereum
In the Ethereum market, a consistent influx of liquidity into derivatives suggests that the current upward trend is stable rather than temporary, according to an analyst known as Arab Chain from CryptoQuant. The analyst pointed to a 30-day change in open interest as evidence of sustained investor engagement.
- Bybit: Reported a jump of 2.51 million ETH, indicating liquidity redistribution;
- Binance: Open interest rose by 11,400 ETH, reflecting ongoing interest;
- Bitfinex and Kraken: Saw declines of 35,700 ETH and 4,300 ETH, respectively;
- Gate: Showed minimal activity.
Arab Chain concluded that the high level of open interest supports Ethereum's bullish momentum, although the diverging activity across platforms indicates varying trader strategies, as some reposition to manage risk while others capitalize on major platforms. Notably, on March 17, another analyst reported a resurgence of Bitcoin buyers on leading exchanges.
