Citigroup expects the price of Ethereum to drop to $4,300 by the end of the year

Jinse Finance reported, citing CoinDesk, that Wall Street giant Citigroup has released a new Ethereum price forecast, predicting its price will reach $4,300 by the end of the year, representing a decline from its current price. However, this is only the base case scenario. The bank's comprehensive assessment covers a wide range, with an optimistic scenario projecting Ethereum's price at $6,400, and a pessimistic scenario at $2,200. Citibank analysts stated that network activity remains a key driver of Ethereum's value, but most recent growth has occurred on Layer 2 networks, and the "value transfer" to Ethereum's base layer remains unclear. Citi assumes that only 30% of Layer 2 network activity contributes to Ethereum's valuation, which means the current price is higher than its activity-based model predicts. This may be due to strong capital inflows and market enthusiasm driven by tokenization and stablecoins. Citi expects that, given Ethereum's relatively small market capitalization and lower recognition among new investors, capital inflows will remain limited. Macroeconomic factors are considered to provide only limited support. As the stock market is already close to the bank's S&P 500 target of 6,600 points, analysts expect that risk assets will not see a significant rally.