Citi Slashes ETF Inflow Forecast to Zero and Cuts Bitcoin and Ethereum

Global banking giant Citi has significantly revised its outlook on digital asset markets, cutting its forecast for exchange-traded fund (ETF) inflows to zero over the next 12 months. The updated projection marks a sharp downgrade from the bank’s earlier estimate of $10 billion in net inflows, reflecting growing caution around broader macroeconomic conditions and investor sentiment.

The revision signals a more conservative stance on the near-term performance of cryptocurrency-linked investment products, particularly spot ETFs tied to major digital assets. According to Citi’s updated outlook, weakening liquidity conditions and uncertainty in global markets could limit institutional demand for crypto exposure through regulated investment vehicles.

Alongside the ETF inflow downgrade, Citi also revised its price targets for major cryptocurrencies. The bank lowered its 12-month forecast for Bitcoin from $112,000 to $82,000, representing a significant reduction in expected upside potential compared to its earlier projections. Ethereum’s price target was also reduced from $3,175 to $2,240.

These revisions reflect a broader reassessment of risk across global financial markets, as investors navigate shifting expectations around interest rates, economic growth, and potential recessionary pressures.

In a more pessimistic scenario, Citi outlined a bear case in which Bitcoin could decline to approximately $53,000, while Ethereum could fall as low as $1,094. This downside scenario is based on assumptions of worsening macroeconomic conditions, including a potential global recession and continued ETF outflows from digital asset markets.

The bank’s updated analysis highlights the growing sensitivity of cryptocurrency markets to macroeconomic trends. In recent years, institutional adoption through ETFs has been seen as a key driver of demand for digital assets. However, Citi’s revised forecast suggests that this inflow channel may not provide the level of support previously expected in the short to medium term.

ETF inflows have played a critical role in shaping cryptocurrency market performance, particularly following the introduction of regulated Bitcoin and Ethereum investment products in major financial markets. These vehicles have allowed institutional investors to gain exposure to digital assets without directly holding cryptocurrencies, contributing to increased liquidity and market participation.

However, Citi’s decision to reduce its inflow expectations to zero over the next year suggests a pause in this growth trajectory. Analysts note that ETF demand is highly sensitive to broader investor sentiment, particularly during periods of economic uncertainty or tightening financial conditions.

Macroeconomic factors remain a central focus in Citi’s revised outlook. Persistent inflation concerns, shifting interest rate expectations, and uneven global growth have all contributed to a more cautious investment environment. These conditions tend to reduce risk appetite among institutional investors, particularly in high-volatility asset classes such as cryptocurrencies.

Bitcoin and Ethereum, the two largest digital assets by market capitalization, have historically shown strong correlation with broader risk assets, including technology stocks and growth-oriented equities. As a result, changes in macroeconomic expectations often have a direct impact on their price trajectories.

Source: Xpost

Market participants are also closely watching central bank policy decisions, particularly from the United States Federal Reserve. Interest rate direction remains a key driver of liquidity conditions, which in turn influence demand for speculative and high-growth assets.

Citi’s bearish scenario highlights the potential vulnerability of digital assets in the event of a broader economic downturn. Under recessionary conditions, investors typically move capital into safer assets such as government bonds and cash equivalents, reducing exposure to volatile markets.

In such an environment, continued ETF outflows could further amplify downside pressure on cryptocurrency prices. Reduced inflows would also limit the stabilizing effect that institutional investment vehicles have provided in recent market cycles.

Despite the revised outlook, the long-term trajectory of digital assets remains a topic of debate among analysts. Some market observers argue that structural adoption trends, technological development, and increasing integration with traditional financial systems could still support long-term growth.

Others, however, caution that short-term market performance is likely to remain highly sensitive to macroeconomic conditions, regulatory developments, and liquidity cycles.

Information regarding Citi’s revised forecasts has also circulated within financial communities and market commentary platforms, including discussions among analysts and traders on social media platforms such as X. These conversations reflect growing attention to the relationship between traditional financial institutions and the evolving digital asset market.

While Citi’s updated projections represent a more cautious stance, they also underscore the increasing role of major global banks in shaping expectations around cryptocurrency markets. As institutional research desks continue to expand coverage of digital assets, their forecasts are becoming an important reference point for both retail and institutional investors.

The updated targets for Bitcoin and Ethereum mark a notable shift from earlier, more optimistic projections that anticipated stronger ETF-driven demand. The downward revision suggests that expectations for rapid institutional inflows may have been overly aggressive given current market conditions.

For investors, the revised outlook serves as a reminder of the inherent volatility in cryptocurrency markets and the importance of macroeconomic factors in shaping price direction.

As the global economy continues to adjust to evolving monetary policy conditions, digital asset markets are likely to remain closely tied to broader financial trends. The next 12 months may prove critical in determining whether ETF inflows can recover or whether the current slowdown represents a more sustained shift in investor behavior.

For now, Citi’s updated forecast reflects a more cautious and risk-aware approach to digital assets, highlighting the potential challenges facing Bitcoin, Ethereum, and the broader cryptocurrency market in the near term.

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Writer @Victoria

Victoria Hale is a writer focused on blockchain and digital technology. She is known for her ability to simplify complex technological developments into content that is clear, easy to understand, and engaging to read.

Through her writing, Victoria covers the latest trends, innovations, and developments in the digital ecosystem, as well as their impact on the future of finance and technology. She also explores how new technologies are changing the way people interact in the digital world.

Her writing style is simple, informative, and focused on providing readers with a clear understanding of the rapidly evolving world of technology.

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