Citi’s digital assets team says the recent slide in crypto prices reflects fading appetite from institutional and retail investors alike.
Bitcoin, at $101,990.20, has slipped below its 200-day moving average, a technical signal that could further dampen demand, while inflows to US spot exchange-traded funds have slowed sharply.
The bank notes that October’s wave of forced liquidations appears to have dented confidence among “crypto natives” and ETF investors.
That matters because Citi’s more optimistic outlook for Bitcoin, which it sees anchored around $80,000 in its base case, depends on steady inflows into those funds. Without them, it warns, the market may struggle to hold current levels.
On-chain data paints a similar picture. The number of large Bitcoin holders, or “whales”, has been edging lower, while smaller retail wallets have grown in share.
Funding rates, which measure how much traders are willing to pay to hold leveraged positions, have also declined, suggesting little enthusiasm for taking risks.
Citi stresses that it still sees the broader adoption of digital assets as being in its early stages, particularly among financial advisers and traditional investors. But for now, the lack of sustained buying through ETFs looks to be keeping a lid on prices.
In short, sentiment has turned cautious. Unless ETF demand revives, Citi thinks crypto’s next move is more likely to be sideways than sharply higher.