Wall Street sharpens its Bitcoin outlook as Citi and JPMorgan flag upside after market reset

After a turbulent phase for crypto markets, major U.S. banks are revising their Bitcoin outlook as they reassess regulation, positioning, and macro relevance.

Wall Street outlook turns more constructive on Bitcoin

Bitcoin is once again drawing serious attention from Wall Street, with fresh analysis suggesting the worst of the recent selloff may have passed. Two of the biggest U.S. banks, Citigroup and JPMorgan, are presenting new scenarios that point to strong upside potential over the next year.

The timing stands out. Bitcoin has already endured a sharp correction, major liquidations, and renewed regulatory scrutiny in the United States. However, large banks now argue that the recent reset looks more like a stabilization phase than the start of a deeper downturn.

Moreover, institutional desks are increasingly treating Bitcoin less as a short-term trade and more as a macro asset, aligning it with themes such as inflation, liquidity, and risk appetite rather than purely speculative flows.

Citi sees upside as U.S. policy backdrop improves

Citigroup has set a 12-month Bitcoin price target of $143,000, anchored in growing adoption and what it sees as a more supportive regulatory environment. At the time of its note, Bitcoin traded around $87,932, leaving significant headroom if those assumptions hold.

“We anticipate regulatory catalysts will drive further adoption and flows,” Citi said, highlighting that easing pressure from watchdogs could unlock new institutional demand. That said, the bank still stresses the importance of policy clarity for longer-term confidence.

The bank pointed to policy shifts in the U.S. that follow renewed support for digital assets at the political level. This shift has coincided with dropped lawsuits against major crypto firms and fresh momentum in Congress, where lawmakers have confirmed that a markup for long-awaited crypto market structure legislation is expected in January.

In a post referencing Senate leadership, Citi cited the message:

“We had a great call today with Chairmen @SenatorTimScott and @JohnBoozman who confirmed that a markup for Clarity is coming in January. Thanks to their leadership, as well as @RepFrenchHill and @CongressmanGT in the House, we are closer than ever to passing the landmark crypto…”

However, Citi also acknowledged how volatile the recent period has been. Bitcoin dropped sharply in November, losing more than $18,000 in value, its biggest dollar decline since May 2021, as investor risk appetite weakened and concerns around technology valuations intensified.

Still, the bank believes prices are now stabilizing after that reset. “Token prices are closer to statistical measures of value based on user activity following the price reversal from October’s highs,” Citi noted, suggesting that current levels look more aligned with underlying network metrics.

Under a more optimistic scenario, Citi sees Bitcoin climbing to around $189,000. In a bearish case, it places the price closer to $78,000, illustrating a wide but clearly defined range for the next 12 months.

JPMorgan argues the worst of the selloff is behind Bitcoin

JPMorgan‘s latest analysis, released last month, focuses less on regulation and more on the mechanics of the recent selloff. The bank believes Bitcoin could reach around $170,000 within the next 6 to 12 months, assuming that a completed deleveraging phase continues to support prices.

“The message from the recent stabilization is that deleveraging in perpetual futures is likely behind us,” JPMorgan analysts wrote. That conclusion hinges on the behavior of leveraged traders rather than solely on spot market flows.

The bank pointed to record liquidations on Oct. 10, described as the largest in crypto history, followed by smaller selloffs in November. Since then, futures positioning has returned to more normal levels, reinforcing the idea that the most aggressive unwinding has already taken place.

Moreover, this perspective aligns with a broader institutional bitcoin momentum narrative, in which leveraged excess is cleared out before longer-term capital steps back in.

Bitcoin’s shifting role and the gold comparison

JPMorgan also revisited the comparison between Bitcoin and gold, emphasizing how changing volatility dynamics matter for asset allocators. According to the bank, rising gold volatility has improved Bitcoin’s appeal on a risk-adjusted basis for certain portfolios.

On that framework, JPMorgan argues that Bitcoin still trades well below its theoretical fair value. However, that assessment depends heavily on assumptions about adoption, liquidity, and the long-term role of digital assets in diversified portfolios.

In practical terms, analysts now see the bitcoin outlook as increasingly tied to its treatment as a macro instrument, not only as a speculative token. This evolving status is central to how large institutions model potential allocations.

Moreover, Bitcoin is now frequently analyzed alongside traditional hedges and growth assets, including equities, bonds, and commodities such as gold, underlining the growing bitcoin vs gold comparison theme across research notes.

From regulation to market structure: the Bitcoin outlook

Looking ahead, the banks highlight two main drivers for crypto investors to watch: U.S. policy developments and the behavior of derivatives markets. On the policy front, any further bitcoin regulation easing us could support new inflows from cautious institutions.

On the market-structure side, JPMorgan’s view that bitcoin futures deleveraging is largely complete suggests a healthier backdrop for price discovery. However, sudden shifts in leverage or liquidity could still trigger renewed volatility.

Overall, the combined Citi bitcoin price target and JPMorgan bitcoin forecast present a cautiously optimistic narrative. While their ranges differ, both signal that the sharp correction, record liquidations, and regulatory headwinds may have laid the groundwork for a more constructive phase in the coming year.