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Citibank Analyst: Six key factors including ETF activities and regulation will help determine the trend of cryptocurrency in 2025

Citibank Analyst: Six key factors including ETF activities and regulation will help determine the trend of cryptocurrency in 2025

Bitget2024/12/26 04:42

Citi analyst Alex Saunders pointed out six key factors that will help determine the price of cryptocurrency in 2025 in a report last Friday, including ETF activity, regulation and the future of stablecoins; supportive macro background. The analysts expect that the current macro backdrop will continue to support high-risk trading into the first quarter of next year, but warn that prospects thereafter are less certain. They said the outlook could shift depending on Trump's economic policies and stock market volatility.

The continued inflow of funds into spot ETFs is expected by analysts to persist until 2025, providing further momentum for its price growth during its first year of listing. Cryptocurrency allocation in portfolios will also be key to future returns. During this year's rebound period, Bitcoin has added value to multi-asset portfolios, they noted. However, it remains a highly volatile and risky asset; when allocated more than 3%, it poses risks amounting to 10% or more to the total portfolio.

Analysts say that after Trump was elected, there was a boost in continuous issuance of stablecoins which would help create a healthier cryptocurrency market. Higher adoption rates are considered as one of most important themes for cryptocurrencies according to them. Lastly with regards to relaxed regulations - with Trump taking office soon - regulation is set become a major theme next year. The incoming U.S president has appointed several pro-cryptocurrency candidates into his cabinet whose policies remain unclear yet industry widely expects regulations would be looser potentially driving broader adoption.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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