Citi has just flipped the script on Crypto’s Power Duo, and ether is the new favorite

Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below.

Wall Street has just signaled a seismic shift in how institutional money views cryptocurrencies. Citigroup It raised its year-end forecast for Ethereum while trimming its forecast for Bitcoin on October 2, marking a potential inflection point in the debate over which digital assets deserve priority in investors’ portfolios.

The move reflects a fundamental recalibration taking place in financial markets: investors increasingly prefer yield-generating assets over pure price appreciation, According to To Reuters. For ether, this means that its ability to generate returns through decentralized and decentralized finance platforms finally translates into institutional favoritism over Bitcoin’s direct “digital gold” proposition.

Don’t miss:

Citi’s $4,500 target for ether suggests a roughly 3% upside from its current trading level of $4,375, while Bitcoin’s $133,000 target suggests a roughly 12% upside from $118,747. Looking ahead, the bank expects ether to rise to $5,440 over the next 12 months, with Bitcoin reaching $181,000.

But the real insight does not lie in the price targets, but in the rationale behind them. Bitcoin’s outlook has been revised lower due to offsetting macro factors including a stronger dollar and weaker gold prices, suggesting that even as Bitcoin maintains its “digital gold” narrative, external market forces are creating headwinds.

Meanwhile, Citi analysts raised their year-end forecasts for ether following a sharp jump in token prices over the summer as institutional investors and financial advisors ramped up buying of cryptocurrencies. The bank expects ether to end 2025 slightly higher, supported by strong inflows from exchange-traded funds and digital asset vaults.

TRENDING: Microsoft’s Climate Innovation Fund just backed this farmland manager – Accredited investors can join the same fund

The shift towards ether reflects the maturity of the cryptocurrency market as fundamentals become increasingly important. While Bitcoin’s maximum supply and store of value thesis remains compelling, the utility of ether is within Ethereum The network creates multiple revenue streams that resonate with traditional finance professionals trained to evaluate cash flows and returns.

Citi’s base case assumes strong year-end inflows of $7.5 billion into bitcoin, but the bank’s bullish scenario for ether depends on increased adoption and potential return generation across DeFi and decentralized finance platforms — factors that could be more durable than bitcoin’s reliance on investor sentiment alone.

Risk scenarios paint an equally revealing picture. Citi’s bear case sees Bitcoin prices fall to $83,000 if stagnant macro conditions materialize, while Ethereum’s downside is difficult to determine due to uncertainty around network activity and value accumulation. This complexity may actually be an advantage, suggesting that ether has more variables supporting its price than Bitcoin’s more straightforward correlation to macro conditions.

See also: Do ​​you have more than $100,000 to invest? Charlie Munger says this is the hardest teacher – don’t stop now. Get matched with a credit counselor and keep building

Both tokens are trading above user activity-based metrics, and Citi stressed that continued demand from investors will be key to supporting prices through the end of the year and into 2026. Translation: Current prices for both assets are already pricing in significant optimism about their future adoption.

For investors, Citi’s recalibration suggests considering allocation strategies that take into account Ether’s return potential rather than treating all cryptocurrencies as undifferentiated speculative bets. The institutional shift toward ether does not invalidate the investment case for Bitcoin, but it does suggest that a diversified cryptocurrency portfolio may be increasingly tilted toward assets that generate returns beyond mere price appreciation.

The bigger question is not which token will win, but whether traditional finance’s embrace of yield-generating crypto assets will accelerate institutional adoption or simply create a new class of assets with interconnected risks exposed to the same macro forces affecting stocks and bonds.

Read next: Trade cryptocurrency futures on Plus500 with bonuses up to $200 – There are no wallets, just price speculation and free paper trading to practice different strategies.

Image: Shutterstock

This article Citi has just flipped the script on Crypto’s Power Duo, and ether is the new favorite Originally appeared on Benzinga.com