Citigroup Just Slashed Its Bitcoin Price Target to $112,000 — Is Washington About to Kill the Bull Run?

Bitcoin’s Price Target Gets a Major Haircut as Wall Street Braces for Regulatory Delays

In a move that’s sending shockwaves through the cryptocurrency market, Citigroup has dramatically slashed its 12-month Bitcoin price forecast, cutting it from $143,000 to $112,000. The banking giant’s decision reflects growing concerns about the pace of regulatory progress in Washington and its potential impact on institutional adoption.

The revision comes at a critical juncture for the crypto market, with Bitcoin struggling to break through the $90,000 resistance level. This consolidation phase has left many investors wondering whether the much-anticipated bull run is losing steam before it even gains momentum.

Citigroup’s strategist, Alex Saunders, points to a core issue: the regulatory catalysts that markets were banking on following the election are now running behind schedule. The legislative window to unlock the next wave of ETF-driven demand is closing faster than anyone had anticipated, potentially derailing the bullish narrative that had been building throughout 2024.

The timing of this revision is particularly noteworthy. It signals a cooling of the post-election “Trump trade” euphoria that had Wall Street buzzing late last year. Investors had been positioning themselves for a crypto-friendly regulatory environment, but those hopes now appear to be waning.

It’s not just Bitcoin feeling the heat. Citigroup has also slashed its Ethereum target, reducing it from $4,304 to $3,175. This move underscores that the second-largest cryptocurrency is not immune to the regulatory slowdown either, suggesting a broader market concern rather than an isolated Bitcoin issue.

The revised outlook from Citigroup suggests that the regulatory catalysts needed to drive fresh ETF inflows may not materialize until late 2026. This delay could have significant implications for the crypto market’s growth trajectory, potentially pushing back institutional adoption timelines by years.

However, there’s a fascinating divergence in the market that’s worth noting. While Citigroup is cautious about the regulatory landscape, BlackRock – the world’s largest asset manager – just bought $600 million in Bitcoin anyway. This move highlights a key tension in the market: while some are waiting for regulatory clarity, others are focused on long-term supply constraints and treating current prices as an accumulation zone.

This divergence is further supported by on-chain data. Large Bitcoin wallets have resumed accumulation according to Santiment, absorbing sell pressure from short-term holders. This pattern typically precedes price expansion, but without the legislative green light that Citigroup is waiting for, that expansion could be pushed further into 2026.

The market now finds itself at a critical juncture, with two potential scenarios playing out:

Bull Case: If Bitcoin can reclaim $92,000 on high volume, the bearish thesis gets invalidated. This would open up a path to $112,000. This scenario would require ETF inflows to reverse and ideally a dovish signal from the Federal Reserve.

Bear Case: If Bitcoin loses $84,000, we could see a slide to $72,000, with $70,000 coming into view. Congressional gridlock could confirm the narrative drought, and price could drift toward lower liquidity zones. In this scenario, Citigroup’s own bearish target of $78,500 could come into play.

The key metric to watch now is ETF flow data. If inflows stay stagnant, $112,000 might look optimistic. However, if billion-dollar inflow weeks return, the old $143,000 target could come back into play.

Right now, the market is in a holding pattern, waiting for Washington to decide which scenario it wants to hand crypto. The next few months will be crucial in determining whether the current consolidation is just a temporary pause or the beginning of a more prolonged bear market.

As we navigate these uncertain waters, it’s clear that the crypto market’s fate is increasingly tied to regulatory developments. The question now is whether the industry can weather this period of uncertainty or if it will need to recalibrate its growth expectations for the foreseeable future.

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