What does 2025 have in store for crypto and digital assets? | Opinion

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As I delve into this fascinating piece, it’s evident that we’re standing at the precipice of a transformative era for cryptocurrency and digital assets. Brett Reeves, a seasoned finance professional with an impressive background spanning across continents, is leading the charge at BitGo’s Go Network.

With his extensive experience in traditional finance, Brett has undeniably brought a unique perspective to the digital asset landscape. His tenure at global investment banks like Citibank, Nomura, and Standard Chartered Bank, coupled with his stint at Bequant, has equipped him with the knowledge and connections necessary to navigate this dynamic sector.

In the world of cryptocurrency, where fortunes can change as swiftly as the market’s mood, Brett’s steady hand and strategic acumen are invaluable assets. His role at BitGo, a trusted institutional digital asset infrastructure provider, positions him at the heart of this burgeoning industry.

Looking ahead to 2025, I believe we can expect nothing short of groundbreaking innovations from Brett and his team at BitGo. The rise of stablecoins, increased institutional adoption, and regulatory clarity are just a few developments that could shape the future of digital assets.

And as we stand on the brink of this exciting new chapter, let’s not forget to keep a sense of humor. After all, in the world of finance, it’s always good to remember that numbers never lie—but accountants do!

2024 saw a pivotal moment for the world of cryptocurrencies. During this time, Exchange-Traded Funds (ETFs) based on Bitcoin (BTC) became the main focus, demonstrating Bitcoin’s durability and establishing it as an enduring element in the global financial system.

Following an early upward trend after ETF introduction, the market showed a period of horizontal movement while the industry faced obstacles. Some of these difficulties were referred to as “debanking” by certain US regulatory authorities, underscoring the growing pains of a developing sector that is yet to achieve broad acceptance and integration.

2020 saw the US Presidential elections become a major topic, particularly in the second half of the year. Discussions about cryptocurrency took center stage in political debates. As Donald Trump prepares to assume office in January, his administration is expected to present a significantly different approach towards digital assets compared to previous administrations. Often referred to as the “Crypto President,” Trump’s positive views on blockchain technology suggest a significant shift from the stance of the Biden Administration.

Appointing Paul Atkins as the head of the SEC demonstrates a move towards a more adaptive regulatory climate for blockchain technology, given its transformative capabilities. In this context, Bitcoin has reached an unprecedented achievement by exceeding $100,000—a significant marker reflecting the sector’s increasing maturity and global importance.

Crypto adoption: A steepening curve

Over the last 15 years since Bitcoin was born in 2009, it’s become clear that blockchain technology has been a game-changer and is still reshaping various business sectors. This transformation can be seen in fields as diverse as finance, gaming, supply chain, and social media. Blockchain offers faster, cheaper, and more secure operations, leading to significant changes. Although blockchain technology existed before Bitcoin, its use has grown rapidly alongside the increase in cryptocurrencies.

Is it likely that we’ll see an increase in the number of crypto users by 2025? Based on current trends, it seems very probable. The number of active crypto wallets is growing at a rapid pace, surpassing even the speed at which internet users were increasing during the early 2000s. This growth mirrors the expansion of the internet in many ways, with periods of decline, such as the dot-com crash, mirrored in the downturns experienced by the crypto market in 2022 and 2023. However, just as the internet bounced back after the crash, the crypto sector is now primed for more development and innovation.

The adoption of cryptocurrencies is complex, involving applications that stretch beyond simple investment and speculation. Here are some areas where we anticipate the technology will continue to influence significantly:

1. Cross-border payments: Cryptos have the potential to facilitate fast, secure, and low-cost international transactions without intermediaries.
2. Financial inclusion: By providing access to banking services for the unbanked and underbanked populations, cryptocurrencies can help bridge the financial divide in underserved communities.
3. Smart contracts: Decentralized applications (DApps) using smart contracts enable automation of agreements and processes without intermediaries, reducing costs and increasing efficiency.
4. Identity verification: Blockchain technology’s secure and decentralized nature can be leveraged for more robust and privacy-preserving identity management systems.
5. Supply chain management: Cryptos can help improve transparency, traceability, and accountability in supply chains by providing a tamper-proof record of transactions along the way.

  • Building applications: Developers and technologists are acquiring crypto assets to utilize blockchain protocols, enabling the creation of decentralized applications. These applications are already enhancing real-world experiences, particularly in gaming, where new titles leverage blockchain to allow gamers to earn tokens and seamlessly transfer value between games.
  • Investment opportunities: Crypto assets are becoming an integral part of diversified investment portfolios. Whilst a core set of adopters have been “HODLing” for years, retail and institutional interest is surging with the introduction of regulated exchange-traded funds. These ETFs, tied to underlying assets like Bitcoin and Ethereum (ETH), provide investors with a more accessible way to engage with the crypto market. The pipeline for additional ETFs is growing, broadening investor choice.
  • Treasury management: Corporations are also exploring crypto’s potential, with companies like MicroStrategy using Bitcoin as part of their treasury management strategy. Major players such as Microsoft and Amazon, as well as entire nations, are evaluating similar moves, recognizing Bitcoin’s utility as a long-term store of value.
  • Cross-border transactions: Stablecoins are revolutionizing global remittances, enabling users, particularly in regions like Asia, to send money internationally with minimal fees and near-instant processing times.

In 2025, we can expect a significant growth spurt in the cryptocurrency landscape. This expansion could be driven by various factors such as individual users adopting decentralized applications, institutional investments in crypto exchange-traded funds (ETFs), and the utilization of stablecoins for transactions. Moreover, blockchain technology’s transformative potential is not only revolutionizing industries but also promoting greater financial accessibility and breeding fresh avenues for innovation.

Moving forward, it’s evident that the realm of blockchain and cryptocurrency is expanding beyond specialized circles, becoming an influential and dynamic factor in the development of both technology and finance.

Good companies prevail in tough times

In recent times, news headlines often associated cryptocurrencies with illegal activities, a notion reinforced by notable incidents such as the biggest financial fraud ever recorded. Yet, similar to how companies like Amazon and eBay survived and even thrived after the dot-com crash, the cryptocurrency sector has proven its ability to bounce back and adapt.

As a seasoned observer of the cryptocurrency market, I have witnessed its evolution over the years, and I must say that recent findings from Chainalysis are particularly encouraging. With my extensive background in finance and technology, I can attest to the challenges faced by this industry as it grapples with issues such as illicit activities. However, the data presented in their 2024 report offers a glimmer of hope. The fact that only 0.5% of total on-chain transaction volume is associated with illicit activity is a testament to the efforts being made by industry players to combat misuse and ensure transparency.

Furthermore, the mid-year update showing a nearly 20% decrease in aggregate illicit activity on-chain year-to-date underscores the strides we are making collectively as an industry. While there is still much work to be done, this progress gives me confidence that the future of cryptocurrency can be bright and free from the stigma of illegitimate activities. I am excited to continue monitoring the developments in this space and contributing to its growth in a responsible and ethical manner.

2022 witnessed the departure of numerous unscrupulous individuals and financially shaky firms, thereby creating a stronger and more resilient cryptocurrency sector. This evolving terrain suggests that the crypto world is no longer a breeding ground for illegal activities but instead is transforming into an exemplar of transparency and financial tracking within the economic system.

Regulatory clarity will foster adoption

Historically, the United States has been a trailblazer, spearheading innovation and regulatory norms worldwide. Yet, in more recent times, political turmoil has hindered the U.S.’s ability to establish definitive regulations for cryptocurrencies. On the other hand, Europe has shown bold initiative by enacting the Markets in Crypto-Assets Regulation (MiCA), which is currently active for stablecoins and aims to be fully operational by January 1, 2025.

Throughout his election campaign, President-elect Trump highlighted his dedication to making the U.S. a pioneer in promoting innovation, with a specific focus on the burgeoning field of cryptocurrencies. He has made it plain that he aspires for America to dominate in Bitcoin mining and blockchain technology advancements on a global scale.

This renewed emphasis is predicted to speed up the establishment of robust regulatory structures within the U.S., making cryptocurrencies more approachable and compliant. These advancements might open the door for significant investments in this sector, placing the U.S. at the forefront as a competitive center for digital asset innovation and finance.

Stablecoins will be more widely used

2025 could witness a surge in the influence of stablecoins within the digital assets sector, which has traditionally been led by some prominent and several smaller players. The pace is expected to quicken, with around a dozen significant stablecoin projects projected to launch during the first half of 2025, as various providers look to seize the growing market demand.

As a researcher delving into the world of digital currencies, I’ve observed an intriguing transformation in stablecoins. Originally conceived as a streamlined instrument for bridging cryptocurrencies and traditional fiat money in trading, they have morphed into a multifaceted solution, proving their worth in both digital and conventional finance realms for transactions and settlements.

Their speed and cost-effectiveness are progressively eclipsing traditional fiat transactions within certain established industries. Moreover, stablecoins function as a vital entry point to Decentralized Finance (DeFi), granting users effortless access to cutting-edge financial products and services in this emerging field.

Stablecoins are now seen as a vital advancement in upgrading financial systems and fostering financial accessibility. In light of this potential, BitGo is creating its own stablecoin, GoUSD, tailored to meet these requirements. The goal with GoUSD is to provide users with a reliable, streamlined, and inclusive financial instrument for the digital marketplace, aiming to empower them financially.

Final thoughts

The beginning of large-scale acceptance by institutions has significantly fueled the fast development of cryptocurrencies. More and more major banks, hedge funds, and publicly-traded businesses are adding Bitcoin to their investment portfolios, indicating a growing faith in its future sustainability.

A striking instance is MicroStrategy, which by December 16, 2024, owned approximately 439,000 Bitcoins, cementing its status as a pioneer in corporate Bitcoin investments. The substantial backing from influential organizations has notably boosted Bitcoin’s reputation as a reputable financial asset within the mainstream market.

The progress made in blockchain technology and cybersecurity has significantly increased trust in Bitcoin transactions, making cryptocurrencies more convenient and usable in daily life. This growth not only boosts users’ confidence but also lays a foundation for wider acceptance within both corporate and consumer sectors.

2025 appears set to mark a significant turning point for the crypto and digital assets sector. As advancements continue and more people embrace these technologies, the years ahead are shaping up to bring about life-changing solutions that could make the future of cryptocurrency just as thrilling as it is impactful.

Brett Reeves

Brett Reeves, at present, serves as the head of Go Network at BitGo, a company specializing in digital asset infrastructure for institutions. Before his tenure at BitGo, Breeves held the position of Head of Business Development at Bequant, a prominent, regulated digital asset Prime Broker. His role involved spearheading global revenue expansion and maintaining strategic relationships with key players within the digital asset industry. Prior to this, he spent nearly two decades working for multiple global investment banks in their Prime Brokerage and OTC Clearing sales divisions. These roles included stints in London for Citibank and Nomura, as well as Standard Chartered Bank in Singapore, where he spent eight years constructing their FX and Interest Rates Prime Brokerage platform, overseeing sales across MENA and ASEAN regions.

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2025-01-02 16:09