Crypto trends to watch in 2025
2025 is shaping up to be a pivotal year for the Crypto world. With Blockchain technology and digital assets rapidly evolving and gaining wider adoption, exciting new trends are emerging. Based on current trends and technological advancements, we can anticipate several key developments in the Crypto space in 2025, as outlined in this article.
New Data Highlights Crypto's Real-World Utility
Crypto adoption continues to grow. A 2024 survey of 2,537 Americans by Kraken, published on December 12, 2024, found that:
- 55% believe Crypto has practical utility, such as access to financial services and decentralized commerce.
- 52% view Crypto as a long-term investment, although 29% remain unsure of its potential.
Misconceptions persist, including:
- 60% think Crypto is linked to illegal activities, despite data indicating that only 0.34% of Crypto transactions in 2024 were related to crime.
- Only 8% believe Crypto is a Ponzi scheme, while 29% still have doubts.
Generational Perspectives:
- Gen X (ages 45-60) recognizes practical value in Crypto the most (63%).
- Millennials (ages 30-44) are also relatively positive (55%).
- Gen Z (ages 18-29) and those over 60 are the most hesitant.
Gen X's trust in Crypto likely stems from their experience with financial crises such as the 2008 recession and COVID-19. They also have a better understanding of Decentralized Finance (DeFi) and Blockchain technology, enabling them to bridge the gap between traditional finance and emerging technologies.
To address misconceptions, education is key. 53% believe negative views on Crypto come from a lack of understanding. Encouragingly, 73% of current Crypto holders plan to continue investing in 2025. (Data from Kraken)
Bitcoin's Continuous Growth
Bitcoin remains a driving force in the industry, poised for continuous growth. This is fueled by institutional adoption, its established position as a leading digital asset, regulatory adaptation, new investment products, and additional government support.
Ethereum is also expected to grow steadily, driven by the development of Ethereum 2.0 and the rise of DeFi, which continues to attract significant attention. Ethereum also boasts a strong infrastructure and increasing usage.
DeFi on Bitcoin, Powered by Layer 2, Shows Significant Growth Potential
Bitcoin is expanding its role to support DeFi through Layer 2 solutions like Stacks, BOB, Babylon, and CoreDAO. This enhances scalability and enables applications on the highly secure Bitcoin Blockchain.
In 2024, Stacks underwent a major transformation with the Nakamoto Upgrade and sBTC, increasing block speed and fully supporting DeFi. This reduces reliance on Wrapped Bitcoin on other networks.
DeFi on Bitcoin is predicted to experience significant growth in 2025, further solidifying Bitcoin's position at the heart of decentralized finance.
DeFi Development from a Technological Perspective
DeFi will remain a key driver of financial innovation, with new projects focused on providing decentralized financial services. The DeFi market is projected to reach $700 billion by the end of 2025, an eightfold increase from its current value (according to Milk Road Pro), reflecting its growing adoption and usage.
Other notable DeFi predictions include:
- The rise of “Liquid Staking/ReStaking”: This innovation enhances asset liquidity and enables its use in DeFi. It's expected to grow more than fourfold within 18 months, with market value increasing from $3.78 billion to $131 billion.
- Stablecoins like USDT and USDC still remain crucial to DeFi's growth.
- DeFi has high growth potential despite current low prices
- DeFi platforms are becoming more user-friendly, increasing accessibility for the general public. Examples of platforms include Aave and Compound.
- DeFi revenue is expected to increase more than fivefold by the end of 2025, while market capitalization remains lower than the Nasdaq tech index, highlighting its long-term growth potential.
- Many DeFi projects are generating sustainable income and have growing user bases.
- Adam Garetson, Partner at Gowling WLG, believes 2025 will see a push for DeFi regulations to bring greater clarity to the industry.
DeFi, as one of the first sectors built on Blockchain, holds immense growth potential and is expected to transform the financial industry by integrating blockchain technology into traditional finance. Despite recent price dips, DeFi continues to evolve, with many promising projects.
Web3 Onchain User Trends and Behaviors 2024 report:
Web3 Onchain User Trends and Behaviors 2024 According to the 2024 Onchain User Report by 'Flipside Crypto', 2024 is a noteworthy year for user growth, with record-breaking numbers of both new users and "Super Users" (users who regularly interact with blockchain and conduct numerous transactions) on leading blockchains. 'Base' showed explosive growth, while 'Ethereum' and Layer 2 successfully adapted to changing user needs. However, the quality of growth varied across cases, highlighting the need to evaluate blockchain activity quality beyond just transaction volumes. Other interesting findings include:
1. User Growth
- New User Growth: October 2024 saw peak new users at 19.4 million, with 'Base' accounting for 13.7 million users, almost 8 times more than second-place 'Polygon'
- Existing User Behavior: Despite 'Bitcoin' reaching $100,000, new user attraction remained low, indicating increased speculation among existing users
- Ethereum's user growth exceeded leading L2s (Arbitrum and Optimism) throughout the year
- 'Base', the DeFi leader, had 15.1 million Super Users (conducting over 100 transactions), 38.4% more than Ethereum's 10.7 million
- 'Polygon', prominent in non-DeFi activities, recorded 867.7 million Super User transactions in 2024
- Ethereum maintained a larger DeFi Super User base than Arbitrum and Optimism combined
- 'Uniswap' grew significantly, capturing 91.3% DEX market share on Base and increasing 27.72% on Ethereum
- 'Trader Joe', the popular DEX platform on Avalanche, maintained leadership with 61.1% market share, growing from 2023
- Despite increased users and transactions, user quality (engagement level, understanding, and application) declined, indicating most users remain at basic levels without deep Web3 ecosystem involvement
- Base's low user quality scores reflect limited engagement from new users beyond specific sectors (like meme coin trading)
- Ethereum's user quality declined before the SEC-approved ETH ETF launch, suggesting institutional investment doesn't guarantee deeper activity
- Blast's initial user base showed broad and deep engagement, but user growth declined in Q4 2024
Onchain User Trends for 2025
- Transforming User Quality: Existing and new blockchain projects must focus on sustainable engagement through diverse activities like governance and staking
- Innovation for User Attraction: Blockchain projects need differentiation through innovative use cases like Memecoin and AI on blockchain
- DEX Market Competition: While Uniswap dominates, unique features like Trader Joe's Auto-Pools on Avalanche could create new market niches, suggesting advanced functions beyond basic DeFi will likely gain attention
Trump's Return Impacts the 2025 Crypto Market: Regulatory Development and Institutional Adoption
- The Crypto market enters 2025 with momentum from the market growth in the latter half of 2024, fueled by investor optimism following Donald Trump's election victory. A prominent Crypto supporter, Trump aims to make the US the “Crypto capital of the world” and has appointed a pro-industry cabinet. This shift is expected to propel the total Crypto market cap to $2 trillion within 16 years.
- The Trump administration has boosted investor confidence. Dean Skurka, CEO of WonderFi, believes the uncertainty that previously held back Crypto investors will diminish. Lower interest rates in the US and Canada in 2024 also contribute positively, providing investors with more capital.
- Many countries are implementing clearer digital asset laws, building trust among financial institutions, investors, and entrepreneurs. This fosters confidence and stability in the Crypto market. The appointment of “Paul Atkins,” a Crypto supporter, as SEC chairman is likely to end the conflict between the SEC and the CFTC (Commodity Futures Trading Commission), leading to clearer regulations that promote growth.
- Senator Cynthia Lummis's advocacy for Crypto as a retirement investment and long-term savings vehicle, along with her proposal for a “National Bitcoin Reserve” as a strategic asset, could further boost Bitcoin's price and solidify its role as a “digital gold.” James Lavish, Managing Partner of Bitcoin Opportunity Fund, suggests that using Bitcoin as a national reserve could encourage other countries to follow suit.
- It's also possible that a G7 or BRICS nation might be the first to establish a Strategic Bitcoin Reserve (SBR), spurred by the Trump administration's proposal to include Bitcoin in US reserves. This has sparked widespread debate and speculation. While such a move requires political support and congressional approval, the mere mention of the concept has a significant impact. It could incentivize other nations to take the lead for strategic advantage. Given Bitcoin's importance as a digital reserve asset and its limited supply, an SBR announcement by a leading nation could be a turning point in the international financial system, potentially reshaping economic and geopolitical power structures in the new era.
Stablecoins Continue to Grow in 2025
In 2024, Stablecoins reached a record high market capitalization of approximately $200 billion, with Tether and Circle leading the market. These digital currencies utilize networks like Ethereum, Solana, and Tron to facilitate seamless, borderless transactions.
Projections for 2025 suggest Stablecoin circulation could double to over $400 billion (according to Forbes). This is driven by the anticipated introduction of Stablecoin-specific legislation, which will provide regulatory clarity and foster innovation. US regulators are recognizing the strategic importance of Stablecoins in strengthening the global dominance of the US dollar.
Bitcoin ETFs Continue to Grow, with New Crypto ETFs on the Horizon
The launch of Bitcoin ETFs last year marked a historic milestone, with AUM exceeding $108 billion in the first year, reflecting high demand from both retail and institutional investors. Industry giants like BlackRock, Fidelity, and Ark Invest have played a crucial role in bringing Bitcoin into the mainstream financial market.
This success paves the way for Ethereum ETFs. In 2025, Ethereum ETFs are expected to add features that support staking rewards, further attracting investors. ETFs are likely to expand to cover other Crypto protocols like Solana, known for its high-performance Blockchain, rapidly growing DeFi ecosystem, and applications in gaming, NFTs, and Memecoins.
We may also see the launch of “Crypto Index ETFs” focused on diversification, combining leading assets like Bitcoin, Ethereum, and Solana with newer protocols. This would offer investors balanced returns reflecting the growth of the Crypto ecosystem. These developments will make Crypto more accessible, efficient, and appealing to a wider range of investors.
Will Environmental Concerns Cause the NFT Market to Crash in 2025?
NFTs will remain popular in art, music, and media, with new applications creating value and unique experiences. However, NFT market growth predictions for 2025 vary:
- Revenue decline: Data from CryptoPresales.com indicates that the NFT market is facing declining revenue and user numbers. Global NFT market revenue is projected to decrease by $75 million, or 11%, compared to last year, marking the second-largest decline in NFT market history.
- Declining interest: Investor interest in NFTs has steadily declined since the 2022 Crypto downturn. Factors include decreased investor interest after the 2021 peak, environmental concerns about NFTs built on energy-intensive Blockchains, economic conditions, and NFT market saturation. This led to a 62% drop in market revenue in 2023, a trend that may continue in 2025.
- Decreasing user numbers: User numbers on NFT platforms like OpenSea, SuperRare, and Rarible are expected to decline to 11.6 million, the same as last year. Wallet usage is also projected to continue declining, with only 17,700 active wallets in 2024, half the number from 2023.
Despite these challenges, there are predictions for growth in areas like gaming, music, and linking digital assets to real-world assets. This could expand the user base and increase NFT value. For the market to recover, addressing environmental impact, project transparency, and delivering real value to users are crucial to building confidence among investors and new users. Most importantly, investors should exercise caution in the NFT market due to its volatility and uncertainty.
Integration of Various Technologies with Blockchain
The trend of integrating technologies like AI and IoT with Blockchain is another key development to look out for. These technologies can enhance efficiency and transparency in various processes, promoting wider Blockchain adoption.
- AI and Machine Learning: These technologies have the potential to play a significant role in market data analysis, developing DeFi financial systems, and creating better user experiences.
- Internet of Things (IoT): Connecting internet-enabled devices to Blockchain can create secure and transparent ecosystems for applications like supply chain tracking and energy management. VeChain is an example of a project using Blockchain for supply chain tracking.
Opportunities and Challenges for Crypto in 2025
In 2025, the Crypto market has significant growth potential due to government support, clearer regulations, and increased institutional adoption. The launch of ETFs, in particular, attracts new investors. However, challenges remain, including price volatility and economic uncertainty, which could impact investor confidence.Finally, Bitcoin is expected to maintain its market leadership and play a crucial role in the industry's future.
*This information is intended as trend forecasting and monitoring interesting developments only and is not investment advice.
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Sources:
https://www.nasdaq.com/articles/crypto-market-forecast-top-trends-will-affect-crypto-2025
https://www.thearmchairtrader.com/crypto/nft-marketplace-forecast-2025-analysis/
https://nftevening.com/6-top-nft-trends-to-watch-out-for-2024-2025/
https://investinghaven.com/crypto-forecasts/15-cryptocurrency-forecasts-2025
https://milkroad.com/daily/defi-will-hit-700b-market-cap-by-eoy-2025
https://www.kraken.com/learn/crypto-myths-survey
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