The circle of currency is getting colder! After Bitcoin falls below $60,000, Citi cuts its target price for Bitcoin and Ethereum.

As the expectations of the Fed raising interest rates continue to rise and institutional investors massively withdraw from cryptocurrency-related ETF assets such as Bitcoin, Citigroup has lowered its 12-month forecast for Bitcoin and Ethereum, citing decreased investor interest, negative fund flows from exchange-traded funds (i.e. cryptocurrency ETFs), lack of progress in U.S. digital asset legislation, which have damaged the investment prospects of these two major cryptocurrencies. It is understood that in recent times, many well-known Wall Street institutions, including Citigroup, have significantly reduced their bullish expectations for Bitcoin or cryptocurrency assets, highlighting that the pricing anchor for cryptocurrency assets has shifted from the "scarcity narrative" to a combination of "ETF fund flow, U.S. dollar interest rates, risk appetite, and institutional allocation preferences". Standard Chartered, known as the "flag bearer of the most aggressive bull market for Bitcoin", recently forecasted that Bitcoin could fall to $50,000 in the short term, and Ethereum could drop to $1,400, and significantly lowered its targets for the end of 2026 to $100,000 for Bitcoin and $4,000 for Ethereum, although its long-term bullish framework before 2030 remains unchanged. In a research report dated Tuesday, Citigroup, a Wall Street banking giant, lowered its Bitcoin target price from $112,000 to $82,000, and its Ethereum target forecast from $3,175 to $2,240. As of pre-market trading time in the U.S. stock market, Bitcoin was trading at $58,864.27, breaking the key technical level of $60,000 last week and hitting the weakest level since September 2024, completely halving from its all-time high of $126,223.18 in October last year. Ethereum was trading at $1,585.63, the lowest level since April 2025. With ETF fund flow turning negative and AI computing power assets attracting capital, Citigroup cut its targets after Bitcoin fell below $60,000 Due to increased volatility in the cryptocurrency market, global funds being sucked into semiconductor assets related to AI computing power infrastructure, and investors rallying around the anticipated large U.S. stock IPOs, as well as continuous outflows from ETFs tracking these cryptocurrency assets, the cryptocurrency market has been performing very poorly this year. Both of the largest market cap cryptocurrency assets are trading below their long-term moving averages, indicating increasingly bearish sentiment. Citigroup's bearish scenario assumes that the macroeconomy is in a shallow recession state and cryptocurrency ETF funds continue to flow out, under this bearish tone, the institution expects Bitcoin to be valued at $53,000 in the next year and the bearish target price for Ethereum is $1,094. Citigroup stated that the forecast revision was due to their decision to lower the ETF net inflow assumption from $10 billion to the zero range. The analysts team at Citigroup said, "ETF fund flow is an important driver of price trends, and it has recently turned negative." The institution added that so far this year, the overall net fund flow into Bitcoin ETFs listed on the U.S. stock market has decreased by about $3.3 billion. The institution expects that until new catalysts emerge, wider institutional investment adoption and allocation will continue to stagnate. The institution also stated that the slow progress in U.S. cryptocurrency legislation and concerns in the market about digital asset reserve companies or cryptocurrency "vault companies" potentially selling large amounts of Bitcoin have dampened investor sentiment. This weakness coincides with a capital rotation into hot AI technology assets related to AI computing power infrastructure. In contrast, the AI super bull market, led by "AI empowerers," has driven the Philadelphia Semiconductor Index (SOX), known as the "global chip stock barometer," to surge by 81% in the second quarter, marking its strongest quarterly performance on record. Meanwhile, AI chip leader NVIDIA Corporation (NVDA.US) only rose by 15% in the quarter, becoming one of the weakest performing components in the SOX index. This extreme differentiation indicates that the AI investment logic is shifting from "computing power monopoly" to deep participation by all AI computing power industry participants. Analysts at market intelligence company Glassnode wrote in a recent report, "The magnitude and duration of these outflows suggest that traditional investors such as Wall Street asset management institutions are still adopting a defensive stance." These analysts added that in the past, Bitcoin pullbacks have attracted strong ETF buying, but this time, institutional investors seem to be reducing their risk exposure to Bitcoin. Cryptocurrencies collectively face a "fund flow trial" With Citigroup cutting its target prices for the largest cryptocurrency assets, Bitcoin and Ethereum, previous long-term bullish views on cryptocurrencies by Standard Chartered Bank have also been significantly adjusted. Standard Chartered recently forecasted that Bitcoin could fall to $50,000 in the short term, and Ethereum could drop to $1,400, and significantly lowered its targets for the end of 2026 to $100,000 for Bitcoin and $4,000 for Ethereum, although its long-term bullish framework before 2030 remains unchanged. In addition, Wall Street market commentary also shows that another well-known asset management firm TD Cowen has lowered its year-end Bitcoin target to $100,000; meanwhile, in June, Bitcoin ETF outflows amounted to approximately $4.5 billion, marking the largest monthly net outflow since the beginning of this year and setting a record for the highest monthly net outflow since the launch of this series of cryptocurrency ETF products. The underlying logic behind the recent cold winter in cryptocurrencies lies in the fact that assets such as Bitcoin and Ethereum are facing a triple repricing: firstly, ETFs have shifted from "institutional incremental buying pressure" to "redemption pressure sources", with Bitcoin ETFs seeing outflows for several weeks, weakening the core institutional narrative since 2024; secondly, high interest rates, a strong dollar, and Fed rate hike expectations are suppressing the valuation of non-cash flow assets, making Bitcoin more like a high beta risk asset rather than a pure safe-haven asset; and thirdly, AI computing power trading is attracting marginal risk capital. Another Wall Street institution, Bernstein, also pointed out that Bitcoin ETF fund flows weakened in 2026, partly due to retail and institutional funds shifting to AI-related assets, but they still believe that the broader ETF, corporate, wealth platform, and institutional investor base makes the market structure healthier than in the past.