Source: VanEck
Author: Matthew Sigel, Patrick Bush
Translated by: BitpushNews
Before we start our 2025 predictions, let's take a moment to review our 2024 predictions. Out of these predictions, we had 8.5 accurate predictions, with an accuracy rate of 56.6%. While not perfect, considering that Bitcoin broke through $100,000 and Ethereum broke through $4,000, even with some inaccurate predictions, 2024 was still a memorable year.
2024 Cryptocurrency Prediction Review
Spot BTC ETP debuts - (1 point)
Bitcoin halving goes smoothly - (1 point)
Bitcoin sets a new all-time high in Q4 2024 - (1 point)
Ethereum remains the second-largest after Bitcoin - (1 point)
L2 dominates Ethereum activity (but L2 TVL still below Ethereum) - (0.5 point)
Stablecoin market cap hits a new high - (1 point)
Decentralized exchange spot trading volume hits a record - (1 point)
SOL outperforms ETH - (1 point)
DePIN network adoption continues to grow - (1 point)
Now, let's dive into our cryptocurrency predictions for 2025.
Top 10 Cryptocurrency Predictions for 2025
Crypto bull market peaks in Q1, sets new highs in Q4
The US embraces Bitcoin through strategic reserves and increased crypto adoption
Tokenized securities value exceeds $50 billion
Stablecoins reach $300 billion in daily settlement volume
On-chain activity by AI agents exceeds 1 million agents
Bitcoin Layer 2 total value locked (TVL) reaches 100,000 BTC
Ethereum blob space generates $1 billion in fees
DeFi hits new highs, with DEX volume reaching $4 trillion and TVL reaching $200 billion
NFT market rebounds, with trading volume reaching $30 billion
Performance gap between DApp tokens and L1 tokens narrows
1. Crypto bull market peaks in Q1, sets new highs in Q4
We believe the crypto bull market will continue into 2025, peaking in the first quarter. At the cycle's peak, we forecast Bitcoin (BTC) to be worth around $180,000, while Ethereum (ETH) will trade above $6,000. Other prominent projects, such as Solana (SOL) and Sui (SUI), could surpass $500 and $10, respectively.
After the first peak, we expect a 30% retracement in BTC, with Altcoins facing a steep 60% decline as the summer market consolidates. However, a recovery may emerge in the fall, with the major tokens regaining momentum and reclaiming their previous all-time highs before year-end. To gauge when the market is nearing a peak, we are monitoring the following key signals:
Sustained high funding rates: When traders are borrowing capital to bet on rising BTC prices, they are willing to pay over 10% annualized funding rates for 3 months or longer, indicating excessive speculation.
BTC Perps funding rate > 10% sustained for months will be a bearish signal
Source: Glass Node, as of December 8, 2024. Past performance is not indicative of future results. This is not a recommendation to buy or sell any securities mentioned.
Excessive unrealized profits: If the proportion of BTC holders with large on-paper gains (profit-to-cost ratio of 70% or higher) stabilizes, it suggests market euphoria.
Market cap overvalued relative to realized value: When the MVRV (market value to realized value) score exceeds 5, it indicates BTC prices are far above the average purchase price, typically signaling overheating.
Bitcoin dominance decline: If Bitcoin's share of the overall crypto market falls below 40%, it means speculative froth is shifting towards riskier Altcoins, a hallmark of a late-cycle behavior.
Mainstream chatter: Unsolicited messages from non-crypto friends inquiring about dubious projects is a reliable signal of approaching speculative mania.
Historically, these indicators have been reliable signals of market exuberance and will guide our outlook as we navigate the expected market cycle in 2025.
For example: A "Top Signal" text from a friend you knew 5 years ago.
2. The US embraces Bitcoin through strategic reserves and increased crypto adoption
The election of Donald Trump has injected tremendous momentum into the crypto market, with his administration appointing crypto-friendly leaders to key positions, including Vice President J.D. Vance, National Security Advisor Michael Waltz, Commerce Secretary Howard Lutnick, Treasury Secretary Scott Bessent, SEC Chair Paul Atkins, FDIC Chair Jelena McWilliams, and HHS Secretary RFK Jr. These appointments not only mark the end of anti-crypto policies, such as systematically undermining the banking relationships of crypto companies and their founders, but also signal the beginning of a policy framework that positions Bitcoin as a strategic asset.
Crypto ETPs: Physical creation, staking, and new spot approvals
The new SEC leadership (or potentially the CFTC) will approve several new US spot crypto ETPs, including a VanEck Solana product. Ethereum ETP functionality will expand to include staking, further enhancing its utility for holders, while both Ethereum and Bitcoin ETPs will support physical creation/redemption. Whether through SEC rule SAB 121 being rescinded by the SEC or Congress, the path will be paved for banks and brokers to custody spot crypto, further integrating digital assets into traditional financial infrastructure.
Sovereign Bitcoin adoption: Federal, state, and mining expansion
We predict that by 2025, the federal government or at least one US state (potentially Pennsylvania, Florida, or Texas) will establish a Bitcoin reserve. From the federal government's perspective, this is more likely to be achieved through an executive order leveraging the Treasury's Exchange Stabilization Fund (ESF), although bipartisan legislation remains an unknown. Meanwhile, state governments may act independently, viewing Bitcoin as a tool to hedge fiscal uncertainties or attract crypto investment and innovation.
On the Bitcoin mining front, the number of countries leveraging government resources to mine Bitcoin is expected to reach double digits (currently at seven) as adoption increases among the BRICS nations. Russia's stated intent to settle international trade in cryptocurrencies has driven this trend, highlighting Bitcoin's growing strategic importance in the global economic landscape.
Number of countries leveraging government resources to mine Bitcoin
Source: VanEck Research, as of December 2024.
We expect this pro-Bitcoin stance to ripple through the entire US crypto ecosystem. With regulatory clarity and incentives attracting talent and companies back, the global share of crypto developers based in the US will rise from 19% to 25%. Concurrently, US Bitcoin mining will thrive, with the US's share of global mining hashrate increasing from 28% in 2024 to 35% by the end of 2025, driven by cheap energy and potential favorable tax policies. These trends will collectively solidify the US's leadership position in the global Bitcoin economy.
US-based public companies' share of Bitcoin hashrate to reach 35%
Source: Data provided by JPMorgan Chase and VanEck Research on December 6, 2024. Past performance is not a guarantee of future results.
Corporate Bitcoin Holdings Expected to Surge 43%
On the corporate adoption front, we expect companies to continue accumulating Bitcoins from retail holders. Currently, 68 publicly-listed companies hold Bitcoin on their balance sheets, and we expect this number to reach 100 by 2025. Notably, we boldly predict that the total amount of Bitcoin held by private and public companies (currently 765,000 BTC) will surpass Satoshi's 1.1 million BTC holdings next year. This implies a staggering 43% growth rate in corporate Bitcoin holdings over the next year.
Gold vs. Bitcoin Ownership: Growth Potential for Corporates and Governments
Source: VanEck Research, as of December 2024.
3. Tokenized Securities Value to Exceed $50 Billion
Onchain Securities Grew 61% in 2024
Source: RWA.xyz, Defillama, as of December 6, 2024. Past performance is not a guarantee of future results.
The crypto rails have the potential to improve the financial system through increased efficiency, decentralization, and enhanced transparency. We believe 2025 will be the year of the tokenized securities takeoff. Currently, there are around $12 billion worth of tokenized securities on the blockchain, with the majority ($9.5 billion) being tokenized private credit securities listed on Figure's semi-permissioned Provenance blockchain.
Going forward, we see a massive potential for tokenized securities to be issued on public blockchains. We believe investors have many motivations driving the tokenization of stocks or debt securities specifically on-chain. Next year, we expect entities like DTCC to enable seamless conversion of tokenized assets between public blockchains and private closed-loop infrastructures. This dynamic will set standards for on-chain investors to implement AML/KYC. As a wild card, we predict Coinbase will take unprecedented steps to tokenize the COIN stock and deploy it on its BASE blockchain.
4. Stablecoins to Settle $300 Billion Daily
180% YoY Growth in Monthly Stablecoin Transfers (USD) in 2024
Source: Artemis XYZ, as of December 6, 2024. Past performance is not a guarantee of future results.
Stablecoins will transcend their niche in crypto trading to become a core part of global commerce. By the end of 2025, we expect stablecoins to settle $300 billion in daily transfers, equivalent to 5% of DTCC's current trading volume, up from around $100 billion per day in November 2024. Adoption by large tech companies (like Apple and Google) and payment networks (Visa, Mastercard) will redefine the economics of payments.
Beyond transactions, the remittance market will also see explosive growth. For example, stablecoin transfers between the US and Mexico could increase 5-fold, from $80 million to $400 million per month. Why? Speed, cost savings, and the growing trust of hundreds of millions who no longer view stablecoins as an experiment but as a practical tool. While everyone talks about blockchain adoption, stablecoins are its Trojan horse.
5. Over 1 Million AI Agents Active On-Chain
AI Agents Earn $8.7 Million in 5 Weeks
Source: Dune @jdhpyer, as of December 6, 2024. Past performance is not a guarantee of future results.
We believe one of the most captivating narratives will be the rise of AI agents, which will translate into a massive draw in 2025. AI agents are specialized AI bots that can guide users to achieve outcomes like "maximize yield" or "drive X/Twitter engagement." Agents leverage their ability to autonomously adjust strategies to optimize these outcomes. AI agents are typically fed data and trained to focus on a specific domain. Currently, protocols like Virtuals provide tools for anyone to create AI agents to execute on-chain tasks. Virtuals allows non-experts to access a decentralized pool of AI agent contributors, such as fine-tuners, data providers, and model developers, so non-technical users can create their own AI agents. The result will be a surge in the number of agent-creators able to rent out their agents to generate income.
The focus of agent-building has been on DeFi so far, but we believe AI agents will transcend financial activities. Agents can act as social media influencers, in-game computer players, and interactive partners/assistants in consumer apps. Agents have already become significant X/Twitter influencers, like Bixby and Terminal of Truths, with 92k and 197k followers, respectively. Therefore, we believe the massive potential of agents will spawn over 1 million new agents in 2025.
6. Bitcoin L2 TVL to Reach 100,000 BTC
Bitcoin L2 TVL Reaches 30,000 BTC, Up 600% YTD in 2024
Source: Defillama, as of December 6, 2024. Past performance is not a guarantee of future results. This is not a recommendation to buy or sell any securities mentioned.
We are closely watching the emergence of Bitcoin Layer 2 (L2) blockchains, which have immense potential to transform the Bitcoin ecosystem. Scaling Bitcoin enables these L2 solutions to achieve lower latency and higher transaction throughput, addressing the limitations of the base layer. Additionally, Bitcoin L2s enhance Bitcoin's functionality by introducing smart contract capabilities, which can support a robust decentralized finance (DeFi) ecosystem built around Bitcoin.
Currently, Bitcoin can be moved from the Bitcoin blockchain to smart contract platforms through bridged or wrapped BTC, which rely on centralized third-party systems vulnerable to hacks and security vulnerabilities. Bitcoin L2 solutions aim to solve these risks by providing a framework for direct integration with the Bitcoin base layer, minimizing dependence on centralized intermediaries. While liquidity constraints and adoption hurdles remain, Bitcoin L2s are poised to enhance security and decentralization, giving BTC holders more confidence to actively utilize their Bitcoins within the decentralized ecosystem.
As shown in the chart, Bitcoin L2 solutions experienced explosive growth in 2024, with the Total Value Locked (TVL) exceeding 30,000 BTC, a 600% increase year-to-date, amounting to around $30 billion. Currently, there are over 75 Bitcoin L2 projects in development, but only a few are likely to achieve widespread adoption in the long run.
Here is the English translation of the text, with the specified terms translated as instructed:This rapid growth reflects the strong demand from BTC holders seeking yield and broader asset utility. As layer-2 technologies and Bitcoin abstraction gradually mature into end-user products, Bitcoin will also become an integral part of DeFi. For example, platforms leveraging layer-chain abstraction like Ika on Sui or Infinex on Near highlight how innovative multi-chain solutions can enhance Bitcoin's interoperability with other ecosystems.
By enabling secure and efficient on-chain lending and other permissionless DeFi solutions, Bitcoin layer-2 and abstraction technologies will transform Bitcoin from a passive store of value to an active participant in the decentralized ecosystem. As adoption scales, these technologies will create immense opportunities for on-chain liquidity, cross-chain innovation, and a more integrated financial future.
7. Ethereum Blob Space Generates $1 Billion in Fees
Source: Dune @hildobby as of December 6, 2024. Past performance does not guarantee future results.
The Ethereum community is actively discussing whether Ethereum is capturing enough value from its layer-2 (L2) networks through Blob Space, a key component of its scaling roadmap. Blob Space acts as a dedicated data layer where L2s submit compressed transaction histories to Ethereum, paying ETH fees per blob. While this architecture supports Ethereum's scalability, the value currently flowing from L2s to the mainnet is minimal, with gross margins around 90%. This has raised concerns that Ethereum's economic value may be overly tilted towards L2, leaving the base layer underutilized.
Although Blob Space growth has slowed recently, we expect its usage to surge by 2025, driven by three key factors:
Explosive L2 Adoption: As users migrate to low-cost, high-throughput environments on DeFi, gaming, and social dApps, Ethereum L2 transaction volumes will grow at over 300% annualized. The proliferation of consumer-facing dApps on L2s, with more transactions ultimately settling on Ethereum, will significantly increase demand for Blob Space.
Rollup Optimizations: Advances in Rollup technology, such as improved data compression and lower costs to publish data to Blob Space, will encourage L2s to store more transaction data on Ethereum without sacrificing decentralization for higher throughput.
High-Value Use Cases: The rise of enterprise-grade applications, zk-Rollup-driven financial solutions, and tokenized real-world assets will drive high-value transactions prioritizing security and immutability, increasing the willingness to pay Blob Space fees.
By the end of 2025, we expect Blob Space fees to exceed $1 billion, up from a currently negligible level. This growth will solidify Ethereum's position as the final settlement layer for decentralized applications while enhancing its ability to capture value from the rapidly expanding L2 ecosystem. Ethereum's Blob Space will scale the network and become a primary revenue source, balancing the economics between the mainnet and L2s.
8. DeFi Hits New Highs, DEX Volumes Reach $4 Trillion, TVL Reaches $200 Billion
Source: Defillama as of December 6, 2024. Past performance does not guarantee future results.
Despite Decentralized Exchange (DEX) volumes reaching new all-time highs, both in absolute terms and relative to Centralized Exchanges (CEXs), the Total Value Locked (TVL) in Decentralized Finance (DeFi) remains 24% below its peak. We expect that driven by AI-related tokens and new consumer-facing dApps, DEX volumes will surpass $4 trillion by 2025, accounting for 20% of CEX spot trading volumes.
Additionally, the influx of tokenized securities and high-value assets will drive DeFi growth, providing new liquidity and broader utility. As a result, we expect DeFi TVL to rebound above $200 billion by year-end, reflecting the growing demand for decentralized finance infrastructure in the evolving digital economy.
9. NFT Market Rebounds, Reaching $30 Billion in Volumes
Source: As of December 6, 2024. Past performance does not guarantee future results. This is not a recommendation to buy or sell any securities mentioned.
The 2022-2023 bear market dealt a heavy blow to the Non-Fungible Token (NFT) industry, with trading volumes plummeting 39% since 2023 and 84% since 2022. While fungible token prices began rebounding in 2024, most NFTs lagged, with weak prices and low activity until a turnaround in November. Despite these challenges, some outstanding projects have leveraged strong community ties to transcend speculative value, weathering the downturn.
For example, Pudgy Penguins has successfully transformed into a consumer brand through collectible toys, while Miladys has gained cultural status in the realm of ironic internet culture. Similarly, the Bored Ape Yacht Club (BAYC) has continued to evolve as a dominant cultural force, attracting widespread attention from brands, celebrities, and mainstream media.
With the rebound in crypto wealth, we expect new affluent users to invest in NFTs, not just as speculative investments, but as assets with enduring cultural and historical significance. Given their strong cultural cachet and relevance, well-known collections like CryptoPunks and Bored Ape Yacht Club (BAYC) are likely to benefit from this shift. While BAYC and CryptoPunks remain far below their historical trading peaks, down around 90% and 66% in ETH terms, respectively, other projects like Pudgy Penguins and Miladys have surpassed their previous price highs.
Ethereum continues to dominate the NFT landscape, hosting the majority of the most important collections. By 2024, it accounted for 71% of NFT trading, and we expect this figure to rise to 85% by 2025. This dominance is reflected in the market capitalization rankings, where Ethereum-based NFTs occupy all of the top 10 positions and 16 of the top 20, highlighting the blockchain's central role in the NFT ecosystem.
While NFT trading volumes may not return to the frenetic highs of previous cycles, we believe that with the market shifting towards sustainability and cultural relevance over speculative hype, a $30 billion annual trading volume is achievable, representing around 55% of the 2021 peak.
10. DApp Tokens Narrow Performance Gap to L1 Tokens
Source: Market Vectors as of December 8, 2024. Past performance does not guarantee future results. The MVSCLE index tracks smart contract platform tokens. The MVIALE index tracks infrastructure application tokens.
A consistent theme of the 2024 bull market has been the outperformance of layer-1 (L1) blockchain tokens over decentralized application (dApp) tokens. For example, the MVSCLE index, which tracks smart contract platform tokens, has risen 80% year-to-date, while the MVIALE index, which tracks application tokens, has returned only 35% in the same period, lagging behind.
However, we expect this dynamic to change in late 2024 as a new wave of dApps are launched, providing innovative and practical products, thereby bringing value to their respective tokens. Within the major thematic trends, we believe Artificial Intelligence (AI) is a prominent category of dApp innovation. Additionally, decentralized physical infrastructure network (DePIN) projects have tremendous potential to attract investor and user interest, helping to achieve a broader performance rebalancing between L1 tokens and dApp tokens.
This shift underscores that in the ever-evolving cryptocurrency landscape, utility and product-market fit are becoming increasingly crucial for the success of application tokens.
