Wall Street Bank Citi (C) refined its crypto-value models to reflect the developing dynamic of the digital asset market and produced a New Year’s ending that sets Bitcoin (BTC) to $ 135,000 in its basic case.
In the bank’s most optimistic scenario, the largest cryptocurrency could climb to $ 199,000 by the end of the year, while a more bearish view that is largely shaped by weak stocks, the prognosis drags down to $ 64,000.
The updated Outlook contains a trio of key trees: User recording, macroeconomic conditions and demand from spot exchange -traded funds (ETFs), the bank said in a report on Thursday.
The essence of Citi’s approach begins with an adoption model based on user activity. The bank’s analysts projected an increase of 20% in user growth along with linear network effects. On your own, it would support a price of approx. $ 75,000.
From there, macroeconomic factors draw around $ 3,200, led by soft equity and gold performance, while an assumed $ 15 billion in additional ETF flows adds about $ 63,000 to the forecast. Result: A Basic-Case output target of $ 135,000.
ETF flow has become a central strength in the design of Bitcoin’s price action since the approval of US spot products in January 2024. Citi estimates that these currents alone now account for over 40% of the recent BTC prize variation, giving them a major role in its new model.
While the adoption curve is still acting as the anchor, the growing integration of crypto in traditional funding means through ETFs, index disorder and greater regulatory acceptance that macro and institutional flows are increasing in significance, the report said.
Citi’s analysts note that the risk of their forecast is tilted to the head. The ETF demand has been faster than expected, and user activity shows a slower than modeled decay speed, suggesting that network effects can continue longer than originally projected.
Bitcoin’s course now depends as much on capital allocation strategies and investor currents as it does with technological adoption, the report says.
Read more: Crypto-Function Wave for $ 60b Year to Date, Transitions Private Equity: JPMorgan
