Citigroup has become one of the newest mainstream voices backing bitcoin's price outlook. On Thursday, Citi analyst Alex Saunders raised his base case price forecast for bitcoin to $113,000, up from the bank's earlier target of $82,000, following the cryptocurrency's strongest quarterly performance since 2024. price targets from major banks, once rare for bitcoin, have become a regular feature of Wall Street research as the asset class has moved further into the mainstream.

Saunders said the upgrade drew on three parts of his research process:

• Market activity
• Macroeconomic conditions
• Exchange-traded fund (ETF) flows

He pointed to debasement fears (concerns that fiscal deficits and monetary expansion erode the purchasing power of fiat currencies) and new rulemaking by the U.S. Securities and Exchange Commission (SEC) as factors that helped crypto regain key technical levels — a shift that took place even after the Clarity Act (proposed U.S. legislation intended to establish a clearer regulatory framework for digital asset markets) failed to pass.

Citigroup Points to ETF Inflows

Renewed fund flows featured prominently in the analyst's updated outlook. Saunders noted that ETF inflows picked up again once prices moved back above the 200-day moving average, a technical level closely watched by market participants as a marker of long-term trend direction.

Citigroup now expects $5 billion in base-case ETF inflows over the next 12 months, a shift from the bank's previous flat estimate, which had assumed no net growth in ETF demand. Because U.S. spot bitcoin ETFs (first approved by the SEC in January 2024) report their flows publicly at the end of each trading day, the projection is one market observers can track in near real time.

The upgraded target lands after a standout stretch for digital assets. Bitcoin logged its strongest quarterly performance since 2024, outpacing gold — long favored as a hedge against currency debasement — even as Treasury yields and commodity prices climbed. Both bitcoin and ethereum closed out the month at their highest levels of the year. Market analyst Bull Theory highlighted the scale of the move in a post on X:

BREAKING: Bitcoin and Ethereum just printed their highest monthly close of 2026. $BTC surged +$25,800 and 44% in the past 3 months, delivering the best Q3 returns since 2017. $ETH surged 71.2% in the same period, its best quarter in history. Macro indicators confirm crypto has entered a new bull market. pic.twitter.com/hY1Z195n2m

— Bull Theory (@BullTheoryio) October 1, 2026 (original post on X)

Despite the strong quarterly numbers, bitcoin's momentum cooled heading into October. The cryptocurrency traded close to $84,784 as of 06:30 ET on Thursday, showing little change on the day.

Treasury Yields Weigh on Crypto Prices

Rising Treasury yields have become a drag on crypto markets as the fourth quarter begins. Markets are bracing for the possibility of more interest rate hikes from the Federal Reserve, a backdrop that has weighed on prices across the digital asset sector.

Bitcoin had climbed as high as $85,600 on Wednesday after the U.S. personal consumption expenditures (PCE) price index — the Federal Reserve's preferred inflation gauge — came in slightly below expectations. The softer reading raised hopes that the central bank might slow its pace of rate hikes. Those gains were partly offset, however, by Treasury yields, which reached fresh multi-year highs on the same day.

Flows also drifted toward other corners of the market this week. Optimism around artificial intelligence, fueled by strong earnings from chipmaker Micron, pulled investment toward technology and semiconductor stocks at crypto's expense.

Attention now turns to upcoming economic data. Markets are watching the U.S. nonfarm payrolls report for August, due Friday, which could offer further clues on the path of interest rates. Commentary from a Federal Reserve official earlier this week was perceived as dovish, reducing some bets on an October rate hike.

Other major cryptocurrencies also moved lower on Thursday. BNB, Ethereum, Cardano, XRP, and Dogecoin all posted declines alongside bitcoin, capping a broadly weaker session for digital assets.

This article is based on reporting originally published by CoinCentral.