Cryptocurrencies will come of age in 2025

Bitcoin (Bitcoin) in 2008, meaning 2025 is the last year before the main cryptocurrency reaches its metaphorical age of 18. This milestone could not have come at a better time: 2025 will indeed be the year in which we see the sector “reach maturity.” There will be tremendous growth, adoption, and momentum across the board.

The industry has weathered many market cycles, and focusing on Bitcoin’s price may give the impression that its growth has been on a volatile path. In fact, all major indicators of digital asset success have risen steadily with Bitcoin. As of January 5, 2025, Bitcoin transactions She was awake 13.56% compared to last year, indicating increased network usage.

Bitcoin Exchange-traded funds She has too receipt $113 billion in total assets under management, illustrating the diverse ways in which investors can gain exposure to Bitcoin and the actual vested interest in the currency’s success. Other tailwinds for the cryptocurrency market in 2025 include growing institutional adoption of BTC, which is becoming increasingly ingrained in corporate balance sheets. Regulatory frameworks are expected to provide greater clarity and chart the path towards sustainable adoption.

Moreover, investors are expected to deepen their focus on prominent sectors from 2024, such as stablecoins and real-world asset tokenization. We can analyze industry growth using a top-down approach, starting with regulators who set the frameworks, progressing to investors who will become more active in deploying capital, and ending with adoption by mainstream institutions and consumers. This stakeholder-focused analysis underscores the increasing maturity of the industry as it becomes increasingly intertwined with the economy.

This analysis shows how the potential of cryptocurrencies is making its way into all corners of business – just as its early believers always envisioned.

Increase regulatory clarity

There will be increased regulatory clarity around the world as markets compete to attract cryptocurrency companies.

In the United States, cryptocurrencies have traditionally operated in a gray area characterized by regulatory hostilities and uncertainties. During the Biden administration, the SEC took a hard line against the cryptocurrency sector and went after exchanges and other cryptocurrency companies by classifying cryptocurrencies as securities that must comply with existing securities law. The SEC has taken enforcement action against high-profile projects like Ripple and portrayed the space as rife with scams and scams. Amid these regulatory risks, many founders have since avoided the US market.

However, the election of President Trump heralds a new governance that is keen to create a legal framework that provides greater clarity and promotes sustainable adoption of cryptocurrencies. We expect regulations around stablecoins to be first put in place in 2025 before broader market structure frameworks are in place.

Elsewhere, we see regulatory frameworks taking shape in various countries, providing clarity for companies operating in the industry. Singapore, which has one of the most progressive frameworks in the world, has developed the framework Digital payment code System and Regulatory framework for stablecoins.

In East Asia, Hong Kong has also created comprehensive frameworks for cryptocurrencies: companies can seek a license under the Securities and Futures Commission as a platform for trading virtual assets, which sets strict regulatory standards in anti-money laundering, terrorist financing and consumer protection.

in europe, Markets in regulating crypto assets (MiCA) is a comprehensive regulatory framework that governs crypto assets, including stablecoins, asset tokens, and electronic cash token regulations across EU member states.

Globally, countries are increasingly adopting cryptocurrencies and introducing frameworks to boost adoption and growth in this sector which will be a major tailwind for the industry in 2025.

Increased VC interest in cryptocurrencies

Interest in venture capital is expected to rise, especially in the fast-growing cryptocurrency sub-sectors. According to A a report From PitchBook, valuations increased across every funding stage for cryptocurrency companies in the first three quarters of 2024 compared to 2023. This pattern indicates renewed interest and momentum in the sector as fundraising becomes more competitive.

The funding trend should continue into 2025 and even see further growth, thanks to regulatory clarity that facilitates greater appetite for institutional adoption and investment (i.e. investors will feel more comfortable making investments knowing that cryptocurrency companies can operate legally in different markets). Without fear of disruption from regulatory authorities).

Several sectors will be of particular interest to investors. The first is cross-border finance, which has long been beset by high fees, slow transaction speeds, and limited transparency — qualities that are not exactly ideal for international business. Investors will open their checkbooks to startups targeting this problem. For example, Homa Financial He grew up $38 million for a blockchain-powered payment financing platform in September 2024. Other startups targeting cross-border financing will likely be targets for venture capital investment in 2025.

Another sector that is expected to gain more attention in 2025 is real-world asset tokenization, which involves tokenizing money, credit, treasuries, commodities and other assets on the blockchain. RWA grew by 66% in 2024, reaching $14 billion in onchain token assets.

One notable project looking to stimulate further adoption of tokenized assets is Plume Network, an EVM Layer 1 compliant blockchain specifically designed for the RWA and its specific compliance and liquidity needs. Bloom Network He grew up Series A of $20 million in December 2024 after $10 million seed Just seven months ago, underscoring strong investor interest in unlocking value gains from tokenized assets in a blockchain-compatible format.

Besides Treasuries and private credit, which are the main beneficiaries of the tokenization narrative, other asset classes that have the potential to unlock significant value through tokenization, along with clear regulatory frameworks for RWAs, are areas to watch in 2025.

2025 could be a record year for cryptocurrency finance across several metrics (transaction value, average transaction size, transaction quantity), driven by regulatory clarity, industry maturity, and improving global liquidity conditions.

Increase institutional adoption

Cryptocurrencies will see increasing institutional adoption from businesses and consumers who want to diversify assets, enhance returns, or improve back-end infrastructure.

MicroStrategy recently made headlines with stock Of Bitcoin. While MicroStrategy may be an anomaly in the scope of its adoption of cryptocurrencies, many companies are embracing digital assets to some extent. These companies are considering and adopting cryptocurrencies due to their technological maturity, increased regulatory clarity, and growing recognition as an investable asset class.

Cryptocurrencies will demonstrate their enormous value to enterprises and retail users across several mature use cases in 2025. The first are stablecoins, which have ballooned to a market capitalization exceeding $205 billion and transaction volume. exceeds $5.6 trillion at the end of 2024, confirming their primary function as digital payment currencies.

Globally, stablecoins are often used for cross-border payments, remittances, merchant payments, and P2P transfers. We expect stablecoin adoption to gain further momentum driven by the benefits of lower transaction costs and faster settlement times.

The intersection between AI and cryptocurrencies is another major catalyst for industry growth. In GenAI, control has been held by a handful of incumbent technology companies, such as OpenAI, Facebook, Anthropic, and Google. Companies in the decentralized AI space, including Sentient, Ceti, Sahari AI, and Aethir, aim to democratize the field so that more companies can unlock operational efficiencies from the technology and contributors to AI development can be fairly compensated.

Collectively, stablecoins, AI, and blockchain infrastructure will drive the next phase of enterprise and retail adoption.

Encryption crystal ball

Predicting a rapidly changing field like crypto is always difficult. There are many factors, including everything from regulators to bad actors, that could change the course of space almost overnight.

After navigating multiple market cycles, the decline in volatility highlights the increasing maturity of the cryptocurrency industry. We are confident in our outlook for 2025, which will see regulators clarifying policies into coherent frameworks, investors supporting startups at unprecedented levels, and increasing demand for blockchain technologies from businesses and consumers.

In short, 2025 will mark the year in which the cryptocurrency industry reaches maturity, where it will firmly establish itself as an asset class across all sectors, as well as being a cornerstone of technological innovation in finance, real estate, artificial intelligence, mobility, and more.

Jupiter Cheng

Jupiter ChengCFA, is a liquid fund partner at HashKey Capital and co-author of Digital asset valuation framework. He is responsible for HashKey Capital’s blockchain research, digital assets and global licensed fund investment businesses.