1. Stablecoins are just getting started
Stablecoins have become a killer application in the crypto space, with a market capitalization of $193 billion and trading volume exceeding $27 trillion, a 3-fold increase year-over-year. The market capitalization is expected to reach $3 trillion within the next five years, with the main applications shifting from trading to global capital flows and the commercial sector.
2. Tokenization of Real-World Assets (RWAs) is expected to see significant growth
As of December 1st, the tokenization of RWAs has reached $13.5 billion, and it is expected to grow rapidly in 2024, with applications expanding into private credit, commodities, and other areas. The tokenization of assets can simplify transactions and reduce risks when used as collateral. Technological advancements and accumulated investments will drive tokenization to become a core part of the crypto market by 2025.
3. Crypto ETFs have forever changed the supply and demand dynamics of cryptocurrencies
After the successful launch of the spot Bitcoin ETF in the US, institutional holdings have surged, driving stable demand growth in the crypto market. In the future, other token ETFs may be approved, but near-term demand is limited. If the SEC allows physical creation, redemption, or staking, it will increase the returns of ETFs and attract more investors.
4. The revival of DeFi will usher in a new era
DeFi has shown greater resilience after experiencing shocks, with lending protocols reaching new highs in Total Value Locked (TVL), and DEX trading volume reaching a peak. Regulatory optimization in the US and on-chain verification are paving the way for traditional institutions to enter the DeFi space, expanding its influence, and promising a bright future.
5. Regulation will ultimately turn from headwind to tailwind
The US is entering the most crypto-friendly regulatory environment, with bipartisan support in Congress driving a comprehensive regulatory framework and stablecoin legislation, marking the end of the enforcement era. Meanwhile, G20 countries are accelerating the development of digital asset rules, creating conditions for innovation and growth. This will help 2025 become a critical year for the crypto industry's breakthrough, laying the foundation for long-term development.
