Crypto will come of age in 2025 | Opinion

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In 2008, Bitcoin (BTC) was first introduced, which means it will reach its symbolic maturity of 18 years in 2025. This significant milestone arrives at an opportune moment as the year 2025 is expected to be a time of expansion, increased adoption, and growing momentum for the cryptocurrency sector – marking its transition into adulthood.

Throughout its history, the Bitcoin industry has navigated multiple market fluctuations, but these price swings might lead one to believe that its development has been as erratic as a rollercoaster ride. Contrarily, significant measures of a digital asset’s prosperity have consistently climbed for Bitcoin. As of January 5, 2025, the volume of transactions in Bitcoin increased by 13.56% compared to the previous year, demonstrating an increase in network activity.

1) The value managed by Bitcoin-based exchange-traded funds has surged to $113 billion, demonstrating various methods for investors to participate in BTC and a tangible stake in the coin’s prosperity. As we look ahead to 2025, several factors are expected to boost the cryptocurrency market: an expanding institutional interest in Bitcoin that is finding its way onto corporate balance sheets, and regulatory guidelines that will offer more clarity and promote responsible growth.

Moving forward, there’s a prediction that investors will pay closer attention to key sectors like stablecoins and asset tokenization starting from 2024. To understand the development of this field, we can employ a hierarchical understanding, starting with regulators who set the rules, followed by investors who are likely to boost their involvement in investment decisions, and ultimately reaching mainstream businesses and consumers. This multi-layered perspective emphasizes the burgeoning maturity of the industry as it becomes more integrated within the economy.

This examination reveals that the possibilities of cryptocurrencies are gradually integrating themselves across various aspects of commerce, much like their initial supporters envisioned in their dreams.

Increasing regulatory clarity 

As global markets strive to lure crypto companies, we can expect a progressive enhancement of regulatory transparency worldwide.

In the U.S., cryptocurrencies have historically existed in a zone of ambiguity, shaped by regulatory opposition and uncertainty. Under the Biden administration, the Securities and Exchange Commission (SEC) has adopted a firm position against the crypto industry, targeting exchanges and other crypto companies by labeling cryptocurrencies as securities subject to current securities regulations. The SEC initiated legal action against prominent projects such as Ripple, painting the sector as a breeding ground for fraud and scams. These regulatory threats have led many entrepreneurs to shun the U.S. market.

Under President Trump’s leadership, there’s an emerging administration that seems eager to establish a legal system offering more clarity and encouraging responsible use of cryptocurrencies. We predict that regulations concerning stablecoins will be introduced around 2025, serving as a precursor for the development of broader market structure frameworks in subsequent years.

In various nations, there’s a trend of regulatory structures being established to offer clear guidelines for businesses within the related sector. Notably, Singapore, known for its advanced regulatory frameworks globally, has defined the Digital Payment Token system and Stablecoin Regulatory Framework.

In the region of East Asia, Hong Kong has put in place extensive regulations for cryptocurrencies. This means that businesses can apply for licensing through the Securities and Futures Commission, allowing them to operate as virtual asset trading platforms. These platforms are expected to adhere to stringent regulatory requirements in areas such as anti-money laundering (AML), countering financing of terrorism (CFT), and consumer protection.

In Europe, the Markets in Crypto-Assets Regulation (MiCA) is a broad regulatory system designed to oversee the management of various types of digital currencies like stablecoins, tokenized assets, and e-money tokens. This framework will ensure consistent regulations for these digital assets across all European Union member states.

Worldwide, more and more nations are progressively adopting cryptocurrencies and establishing systems to foster acceptance and expansion within this field. This trend is expected to significantly propel the industry forward in 2025.

Increasing VC interest in crypto 

Investor enthusiasm towards venture capital is projected to spike, notably in swiftly expanding areas of cryptocurrency. As per a report by PitchBook, valuations for crypto-related businesses have risen at every funding stage during the first three quarters of 2024 compared to those from 2023. This trend suggests a revival and growing energy within the sector, as fundraising becomes more intense due to increased competition among investors.

The financial support for cryptocurrencies is expected to persist through 2025, possibly accelerating further, due to the increased regulatory certainty that boosts institutional interest and investment. In simpler terms, this means that as regulations become clearer, more institutions will feel confident enough to invest in cryptocurrencies because they know these businesses can legally operate in various markets without the risk of regulatory interference.

2025 could see a surge of venture capital investments in several industries, with cross-border finance being one of the key areas. Cross-border finance has historically faced issues such as high charges, sluggish transactions, and lack of transparency, making it less than ideal for global business operations. However, startups addressing these challenges are likely to capture investor attention. For instance, Huma Finance successfully raised $38 million last September for its blockchain-based payment financing platform. Other similar startups in the cross-border finance sector can expect a wave of VC investment next year.

In the year 2025, it’s expected that Real-World Asset Tokenization (RWA) will see increased adoption. This process entails creating digital tokens representing funds, credits, treasuries, commodities, and other tangible assets using blockchain technology. Remarkably, RWA experienced a growth of 66% in 2024, reaching an impressive $14 billion in the value of tokenized on-chain assets.

As a researcher delving into the realm of blockchain technology, one project that has caught my attention is Plume Network – a Layer 1 EVM-compatible blockchain specifically designed for Resource-as-a-Service (RWA) and its unique requirements in terms of compliance and liquidity. The fact that this project secured a $20 million Series A funding round in December 2024, following a $10 million seed round only seven months earlier, highlights the significant investor interest in harnessing value growth from compliantly tokenized assets on a blockchain.

In addition to tokenized securities like treasuries and private credit, which have shown great potential within the tokenization movement, there are other types of assets that could see substantial value increases through tokenization, provided they are regulated appropriately for Risk-Weighted Assets (RWAs) in 2025. Keep an eye on these sectors as they develop.

2025 could potentially break records in cryptocurrency investment across various aspects such as total investment value, typical deal sizes, and number of deals. This surge is likely due to the arrival of clearer regulations, the maturity of the industry, and enhanced global financial fluidity.

Increasing institutional adoption

Institutional investment in cryptocurrencies is expected to rise, as businesses and individuals seek alternatives for asset diversification, yield enhancement, and upgrading their back-end systems.

Recently, MicroStrategy has garnered attention for its significant accumulation of Bitcoin. Although MicroStrategy might be unusual in the scope of its cryptocurrency adoption, numerous businesses are integrating digital assets to varying degrees. These enterprises consider crypto because of its advanced technology, increasing regulatory transparency, and growing understanding of it as a viable investment class.

In 2025, cryptocurrency is expected to demonstrate its significant worth for both corporate and individual users, showcasing its utility in numerous established applications. One such application is stablecoins, which have grown significantly, reaching a market capitalization surpassing $205 billion and transaction volume exceeding $5.6 trillion by the end of 2024. This growth underscores their importance as digital payment currencies.

Worldwide, stablecoins are commonly employed in transactions such as cross-border payments, remittances, purchases from merchants, and peer-to-peer transfers. It’s anticipated that their adoption will continue to expand due to advantages like reduced fees and quicker processing times.

The connection between artificial intelligence (AI) and cryptocurrency is playing a significant role in driving growth within the industry. In the field of GenAI, power has primarily been held by established tech companies like OpenAI, Facebook, Anthropic, and Google. However, decentralized AI firms such as Sentient, Ceti, Sahari AI, and Aethir are striving to make this sector more accessible, enabling a greater number of businesses to capitalize on the efficiency gains offered by AI technology and ensuring that those contributing to its development receive fair compensation.

Together, stablecoins, artificial intelligence (AI), and blockchain technology are expected to lead the next wave of institutional and individual acceptance.

Crypto’s crystal ball 

Predicting trends in the fast-evolving world of cryptocurrency is often challenging due to numerous variables such as regulatory bodies and unscrupulous individuals. These elements have the potential to significantly alter the course of the crypto market within a short period of time.

Having weathered numerous market fluctuations, the decreased volatility signals a growing maturity within the crypto sector. We’re optimistic about the future, anticipating that regulators will streamline policies into consistent structures in 2025. This year is expected to see investors providing record-breaking support to startups, as well as a surge in demand for blockchain technologies among both businesses and consumers.

2025 is anticipated to be the year that cryptocurrency matures, solidifying its position as a recognized investment category throughout various sectors, while also serving as a bedrock for technological advancements in finance, real estate, artificial intelligence, transportation, and beyond.

Jupiter Zheng

As a researcher specializing in the field, I am honored to serve as a Partner Liquid Fund at HashKey Capital, where my responsibilities encompass both blockchain and digital asset research, as well as overseeing our global licensed fund investment business. Additionally, I have had the privilege of co-authoring the Digital Asset Valuation Framework.

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2025-01-13 16:30