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In today’s newsletter:
🔎My crypto predictions for 2025
📊On-chain alpha
😂Crypto meme of the week
🗞️The latest DeFi news
🔎My crypto predictions for 2025
Last year, I wrote a thread where I made 9 predictions for 2024.
While not all of them came true, I believe I had a decent hit rate, so I thought it would be interesting also to share my predictions for 2025.
The best part of the bull cycle generally starts in the next year after the BTC Halving (2017, 2021, 2025), so I think the fun is not over yet.
Without further ado, let’s dive in👇
The US will become very crypto-friendly
A lot of people seem to be wondering if Trump is serious about his pro-crypto stance.
I believe that the answer is yes, and here’s why:
Donald Trump’s World Liberty DeFi project has been buying several coins over the past weeks including ETH, AAVE, WBTC, LINK, and ENA
David Sacks, a big supporter of the crypto industry, was chosen as the next White House A.I. & Crypto Czar
The SEC chair that Donald Trump has chosen is a big crypto advocate
~300 pro-crypto candidates secured their seats in Congress this year
Vice President-Elect JD Vance owns up to $500k in Bitcoin
These are just a few of the things that make me think that the next few years will be great for the crypto projects that are based in the US.
A massive altseason will happen in Q1 or Q2 2025
Not every altcoin will pump as there are now millions of different tokens.
But I expect BTC Dominance to drastically drop at some point next year, which could eventually lead to the beginning of a real altseason.
Currently, BTC Dominance is still close to annual highs. For context, no previous bull cycle has ended without a significant drop in BTC dominance.
And I highly doubt that this time is different.
I believe that AI, Real-world Assets, & Memecoins will be the hottest sectors in 2024, but we might also see a surge in the price of certain utility coins.
Hyperliquid will become a top 6 L1 Ecosystem by TVL
Hyperliquid managed to hit some record numbers this year:
The perpetual DEX reached a maximum 24h trading volume of $15 billion
Its token HYPE reached a $35 billion FDV with no CEX listings
The total value of the HYPE airdrop hit $10 billion at the peak
But the main reason why I believe that the project will continue to shine in 2025 is that it has a major catalyst on the horizon:
The launch of HyperEVM L1 - a high-throughput EVM-compatible L1 blockchain developed by the Hyperliquid team for high-performance dApps
HyperEVM L1 will likely go live at some point in Q1 2025.
Many teams have already announced plans to launch their products on it.
Some notable mentions include Solv Protocol, Ethena, and Anzean Finance.
There’s already some insane hype around Hyperliquid and the release of Hyperliquid’s HyperEVM will only add more fuel to the fire.
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My next prediction is the following:
At least one more country will start buying Bitcoin
In 2021, El Salvador became the first country to adopt Bitcoin as a legal tender.
This year, the US, Russia, Poland, Japan, and Brazil have all started considering buying BTC as a national reserve asset too.
For instance, U.S. Senator Cynthia Lummis introduced a bill to build a strategic Bitcoin Reserve and acquire up to 1M Bitcoin over the next 5 years.
I believe that it’s likely that at least one major country will establish a national BTC strategic reserve in 2025 given the recent developments.
The Bitcoin cycle top will be hit in 2025
We all want our bags to go up forever.
But realistically, a supercycle is unlikely to happen as BTC has historically always topped in the year after Halving.
Yes, institutional adoption is now happening faster than ever before. Yet the whales who bought BTC at $16k-$20k will eventually want to take profits.
I remember that in 2021 when BTC hit $69k everyone on Crypto Twitter was saying that “a supercycle is coming” and that “this time is different”.
Guess what: almost every single altcoin dropped over 90% after that.
My plan is to gradually sell my bags over the next year as I’d rather take profits too early than take profits too late.
The L1 Rotation will be one of the most profitable trends
If you were paying attention to what was happening in this space in 2021, you probably remember the SoLunAvax L1 rotation.
Many tokens from fast-emerging ecosystems such as Solana, Luna, Avalanche, and Fantom had incredible runs at that time.
This year, Solana’s SOL and Hyperliquid’s HYPE also did incredibly well.
Many new hyped blockchains, such as Berachain and Monad, will finally go live in 2025, and this could help the L1 narrative gain more momentum.
With that being said, I’m very excited about what 2025 will bring.
If history repeats itself, the next months should be great for altcoin holders.
On-chain Alpha🔎
$15 billion was distributed through airdrops in 2024
This just shows how insanely profitable airdrop farming continues to be.
In 2025, I wouldn’t be surprised if the total value of airdrops will be even higher than $15b as many hyped projects haven’t released their tokens yet.
Crypto Meme😂
The latest developments in DeFi
The SEC approved the first BTC-ETH Index ETFs
Chainlink introduced Chainlink Smart Value Recapture - a mechanism that creates a new 8-figure revenue stream for the protocol
THORChain released THORChain V3, adding the smart contract functionality. A wide range of dApps are expected to be deployed on THORChain soon
Frax Finance is considering to add BlackRock's BUIDL token as Frax USD stablecoin backing. BUIDL is a BlackRock US Treasury fund with over $500M AUM
Uniswap announced that Unichain L2 mainnet will go live in early 2025
Kaito AI announced a future 150 ETH airdrop that will be split across the top 1,000 Yappers on Jan. 1
Resolv launched its stablecoin USR and RLP on Base. A wstUSR points trading pool also went live on Pendle, which has an implied APR of over 40%
Sonic Labs launched Sonic Gateway, its native bridge, and enabled FTM to S token swaps
Usual, an RWA-backed stablecoin protocol, raised funds from Binance Labs. The TVL of Usual increased from $500M to $1.65b in the past 30 days
Polygon released the v0.2 testnet for Agglayer, its blockchain fragmentation solution.
EigenLayer introduced slashing and launched it on testnet
SushiSwap launched its DEX on Sonic L1
Swellchain, a restaking chain developed by Swell, went live on mainnet
That’s all for this week!
Until next time,
The DeFi Investor
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