Banking giant Citigroup might be softening on its confidence towards cryptocurrency. Citigroup cut its 12-month forecast for bitcoin and ethereum, citing slow U.S. legislative progress that narrows the window for regulatory catalysts expected to boost ETF-driven demand and broader institutional adoption.
“Regulatory catalysts will drive further adoption and flows but the window of opportunity for U.S. legislation this year is narrowing,” Citi strategist Alex Saunders said in a note on Monday.
As per Reuters, progress on U.S. crypto market-structure legislation has stalled in the Senate, with the Clarity Act’s chances of passage declining over disagreements on stablecoin rules and a shrinking window for approval in 2026.
“ETH will be especially sensitive to user activity metrics, which have been weak recently, but stablecoin and tokenization trends may increase interest and usage,” Citi added.
What are Ethereum and Bitcoin?
Bitcoin and Ethereum are two of the most popular cryptocurrencies, but they have different purposes. Bitcoin, created in 2009 by Satoshi Nakamoto, is a decentralized digital currency that allows peer-to-peer transactions without a central authority. It is often called “digital gold” because it is mainly used as a store of value and has a limited supply of 21 million coins.
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Ethereum, launched in 2015 by Vitalik Buterin, is a decentralized platform that enables developers to build and run smart contracts and decentralized applications on its blockchain. Its native cryptocurrency, Ether, is used to pay for transaction fees and computational services on the network. Bitcoin focuses on digital money and value storage, while Ethereum enables programmable blockchain-based applications and services.
“Bitcoin is likely to range-trade anticipating legislative news flow with (about) $70,000 an important level representing the pre-U.S. election price,” Citi said.
Citi said that under a recessionary macro backdrop, bitcoin could drop to $58,000 and ether to $1,198, while its bull case, driven by stronger end-investor demand, puts bitcoin as high as $165,000 and ether at $4,488.
The evolving stance of Citigroup reflects a broader uncertainty surrounding the future trajectory of digital assets like Bitcoin and Ethereum. While these technologies continue to gain recognition globally, their growth remains closely tied to external factors such as regulatory clarity, macroeconomic conditions, and institutional confidence. Delays in legislative progress supposedly highlight how dependent the crypto market still is on policy frameworks, particularly in major economies like the United States.
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The market’s sensitivity to broader economic signals suggests that cryptocurrencies are increasingly behaving like mainstream financial assets rather than purely alternative instruments. This shift brings both opportunities and risks, as investor sentiment can quickly change based on global financial trends, interest rates, and economic stability. For Ethereum in particular, ongoing developments in blockchain usage and digital finance may play a key role in sustaining long-term interest, even amid short-term volatility.
The situation underscores a transitional phase for the crypto industry. It is moving from rapid, hype-driven expansion toward a more mature and regulated environment. Future growth is likely to depend not only on technological innovation but also on the ability of governments and institutions to create supportive and clear frameworks that encourage responsible adoption while managing risks.