Citi Sees Ethereum Stuck in a Sideline Battle Against Macro Forces

Citi has issued a forecast for Ethereum (ETH) that anticipates the cryptocurrency will not reach a new all-time high in 2025 and expects the price to stabilize around $4,300 by year-end. The projection reflects the bank’s cautious approach amid ongoing market volatility and broader economic uncertainties. This outlook contrasts with more bullish predictions from some other financial institutions and highlights Citi’s assessment of Ethereum’s current market dynamics.

The forecast is part of a broader strategic review of Citi’s global operations, which includes a reevaluation of its exposure to high-risk, high-volatility assets like cryptocurrencies. The bank has also been recalibrating its risk appetite in light of macroeconomic challenges, including inflation, interest rates, and geopolitical tensions. Citi analysts have pointed to a range of factors influencing Ethereum’s price trajectory, including regulatory developments, adoption rates, and macroeconomic headwinds such as the U.S. Federal Reserve’s monetary policy.

Citi’s $4,300 price target represents a significant adjustment from Ethereum’s previous peak, which occurred in late 2021 when the token briefly surpassed $4,800. While the cryptocurrency has demonstrated resilience in previous market downturns, Citi’s forecast suggests that the broader financial environment remains a limiting factor for its growth. The bank’s analysts emphasize that Ethereum’s price is likely to remain volatile in the near term, influenced by market sentiment and broader macroeconomic trends.

Citi’s perspective is particularly notable given its historical involvement in digital assets. The bank has previously explored blockchain technology and has supported the development of Ethereum-based solutions, including the Ethereum blockchain’s use in institutional finance and digital identity verification. However, Citi’s latest forecast underscores a shift in its risk appetite, as the firm continues to prioritize more stable revenue streams in the face of economic uncertainty.

In terms of market positioning, Citi’s Ethereum forecast aligns with a more conservative approach to digital assets that has been adopted by several major financial institutions in recent months. This trend reflects a broader industry move to manage risk in the face of macroeconomic headwinds, including slowing global growth and tightening monetary policy. Citi’s forecast also highlights the importance of regulatory clarity in the cryptocurrency space. As governments around the world continue to develop frameworks for regulating digital assets, market participants are closely watching for developments that could impact Ethereum’s price and adoption.

The potential for Ethereum to serve as a long-term store of value remains a topic of debate among investors and analysts. Citi’s forecast does not entirely dismiss the possibility of Ethereum gaining broader adoption or achieving a new price high in the future, but it does suggest that the timeline for such outcomes may be longer than previously expected. The bank’s analysts have also noted that Ethereum’s performance could be influenced by technological advancements, such as upgrades to the Ethereum network that aim to improve scalability and reduce transaction costs.