Analysts of the American bank Citigroup stated that the wave of large—scale liquidations on October 10 and 11 proved that bitcoin has formed a high dependence on the dynamics of the stock market.
Bank analysts have noticed a connection between the cryptocurrency market and securities: the inflow of capital into Bitcoin and Ethereum-based exchange products remains steady, thanks to the emergence of new, less indebted investors who are supporting demand even after a rapid decline.
“Tension in relations between the United States and China caused a sharp collapse in futures, which spread to the crypto market, emphasizing its volatility and strong dependence on stock dynamics. Steady inflows of funds into ETFs support the baseline scenario, while bearish risk is associated with stock market weakness,” Citigroup experts explained.
Despite the collapse of the cryptocurrency market, Citigroup has not made any significant changes to its forecast for the prices of Bitcoin and Ether:
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$133,000 per Bitcoin by the end of the year and $181,000 in the 12-month term;
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$4,500 per Ether by the end of the year and $5,400 during 2026.
The bank believes that Bitcoin is now entering a phase of accumulation, but liquidity will remain low as traders recover from forced sales.
Analysts interviewed by The Block earlier said that the decrease in investors’ appetite for risk and the outflow of funds from spot Bitcoin ETFs are preventing the first cryptocurrency from breaking out of the bearish trend.
