Abstract

Although the Trump administration's silence on Cryptocurrency policy initially disappointed the market, the market still expects that future policies will view Bitcoin as a strategic asset and maintain the global dominance of the US dollar by strengthening stablecoins.

Five major Cryptocurrency trends are expected to emerge by 2025: increased institutional participation, rapid adoption of stablecoins, growth in tokenization of real-world assets (RWA), deep integration of artificial intelligence and Blockchain, and expansion of decentralized physical infrastructure (DePIN).

The Cryptocurrency market has gone through multiple development stages (ICO, DeFi, Non-Fungible Token, P2E), but only a few projects have truly demonstrated lasting value. This suggests that the market should maintain rational expectations rather than blind optimism regarding the Trump administration's Cryptocurrency policy.

1. Introduction

The Cryptocurrency market is entering a critical stage in 2025. With the advent of the "Trump 2.0" era, major companies are experiencing stronger institutional adoption and transforming towards deeper Blockchain implementation, going beyond the previous stage of superficial marketing.

The previously ambiguous regulatory framework is gradually becoming clearer, laying the foundation for a new chapter in the industry.

Although the market is showing positive signals, unprecedented volatility still exists. The traditional market narrative is rapidly disintegrating, and emerging projects are reshaping the landscape, establishing a new market order. This uncertain environment makes it difficult for many investors to adjust their investment strategies.

This report provides an in-depth analysis of the impact of the "Trump 2.0" era on the market, explores the key developments and opportunities in the Cryptocurrency market by 2025, and offers a comprehensive interpretation based on insights from over 300 leading Web3 institutions.

2. What is the "Trump 2.0" era?

Source: TradingView

The impact of the Trump administration on the Cryptocurrency market is already evident. The market capitalization of the $TRUMP token has surpassed $15.1 billion, successfully ranking among the top 15 Cryptocurrencies globally. Melania Trump's meme token has also achieved similar success, reaching a market capitalization of $2.2 billion on its first day of release. Furthermore, the Trump family's previously slow-moving Decentralized Finance (DeFi) project - World Liberty Financial (WLFI) - has successfully raised $20 billion. These events indicate the market's optimistic expectations towards the Trump government.

2.1. Bitcoin as a Strategic Asset

Source: Associated Press photo/Mark Humphrey, archive photo

However, during the inauguration, no statement on Cryptocurrency policy was issued, which was at odds with market expectations. Last year, Trump had stated plans to hold Bit as a national strategic asset and promised to fire the chairman of the US Securities and Exchange Commission (SEC), Gary Gensler, while establishing a new Cryptocurrency committee. Although Gensler has resigned, the lack of substantive policy progress has left the market disappointed.

Regarding the future of Bit as a strategic asset, the market is currently focused on the following three scenarios:

• Maintaining the status quo - Due to opposition from key figures like Federal Reserve Chairman Powell, the government may not make significant policy changes.
• Designating Bit as a strategic reserve - The government's 207,000 Bits may be designated as a strategic reserve asset. According to a proposal by Senator Cynthia Lummis, the government may aim to accumulate 1 million Bits over the next five years.
• Building a US-centric Cryptocurrency asset portfolio - The government may consider establishing an investment portfolio comprising various US-based Cryptocurrencies. However, given the high volatility of Cryptocurrency assets and the lack of consensus even on Bit itself, the feasibility of this scenario is relatively low.

2.2. Strengthening US Dollar-backed Stablecoins

Source: Router

The Trump administration may prioritize strengthening stablecoins over implementing a Central Bank Digital Currency (CBDC). US Treasury Secretary Scott Bessent has clearly stated that "there is no need to implement a CBDC," a position that is not just a campaign promise but is interpreted as a long-term strategy to consolidate the global dominance of the US dollar.

After the outbreak of the Ukraine war, Russia and China have begun taking actions to try to break free from the US dollar-centric financial system. The US has frozen trillions of dollars of Russia's overseas assets after the war, leading Russia to conclude that holding the US dollar as a foreign exchange reserve is no longer safe. At the same time, China has become aware that it may face a similar situation and has been gradually reducing its holdings of US Treasuries.

Against this backdrop, stablecoins are gradually becoming an important tool for stimulating new demand for US Treasuries. Stablecoins, which maintain a fixed value by pegging to fiat currencies, require corresponding collateral assets, and US Treasuries are often the most common collateral. This makes stablecoin issuers major buyers of US Treasuries, which is particularly important given the recent weak demand in US Treasury auctions.

Furthermore, stablecoins have become critical infrastructure in the Cryptocurrency market. Currently, most Cryptocurrency transactions and services rely on the operation of stablecoins. They also play an important role in cross-border payments, providing faster settlement speeds and lower transaction costs, and have demonstrated practical applications in international trade.

As the Cryptocurrency market expands and real-world use cases increase, the adoption of stablecoins is expected to grow significantly. This will further drive stablecoin issuers to reinvest in US Treasuries, lowering the yield on US Treasuries, reducing the fiscal burden, and providing a foundation for maintaining the US dollar's status as the global reserve currency in the digital economy.

The role of stablecoins is similar to the historical "petrodollar" system. After the oil crisis in the 1970s, the US reached an agreement with oil-producing countries to use the US dollar as the standard currency for oil transactions, which led to a surge in demand for the US dollar. Subsequently, oil-producing countries recycled their large US dollar earnings back into US Treasuries and financial assets, supporting the development of the US economy.

The Trump administration seems to view stablecoins not just as a political tool, but as a strategic financial instrument similar to the "petrodollar," ensuring the US's leadership position in the digital economy.

3. Major Institutions' Outlook for 2025

As we enter the "Trump 2.0" era in 2025, what predictions do the leading Web3 institutions have for the future? The core focus is on "accelerating institutional market entry". With the Republican Party controlling both the legislative and executive branches, policy implementation is expected to be more clear and rapid. This could further strengthen partnerships and collaborations with traditional enterprises.

According to a report by Insights4VC, Tiger Research analyzed over 300 predictions to forecast the key trends in the Web3 market. More detailed information can be found in the comprehensive report "Cryptocurrency Market Outlook for 2025" by Insights4VC.

3.1. Accelerated Institutional Market Entry

With the approval of Bitcoin ETFs, the pace of institutional capital entering the cryptocurrency market is accelerating rapidly. ETFs are highly attractive to institutional investors as they meet regulatory requirements and are easy to manage risk. This trend is driving multi-faceted adoption, with corporations and governments increasing their Bitcoin holdings, and financial institutions launching digital asset custody services.

Source: coinglass

According to Bloomberg data, the Assets Under Management (AUM) of Bitcoin ETFs have reached $110 billion and are expected to surpass the holdings of Gold ETFs ($128 billion). VanEck predicts that under the Trump administration, the US's share of Bitcoin mining could rise from the current 28% to 35%. Additionally, corporate Bitcoin holdings are expected to grow by 43%, further supporting the likelihood of accelerated institutional adoption.

These developments will require regulatory reforms in the US. As regulations become clearer, traditional financial institutions may acquire existing cryptocurrency services. This indicates that the boundaries between cryptocurrencies and the traditional financial system will continue to blur, ultimately merging into a single industry.

3.2. Explosive Growth in the Stablecoin Market

Stablecoins are rapidly emerging as an effective alternative to the traditional financial system in cross-border remittances and payments. Compared to traditional international transfers, they significantly reduce high fees and shorten processing times, leading to increased adoption in commercial payments and cross-border remittances. As major banks join the ranks of stablecoin issuers, the market's credibility will further increase.

Source: Coinbase

According to a Coinbase report, the stablecoin market grew by 48% in 2024, reaching a total market capitalization of $193 billion, and is expected to exceed $3 trillion by 2030. VanEck predicts that the daily trading volume of stablecoins will expand to $300 billion, while Galaxy expects major financial and tech companies like BlackRock, Robinhood, and Meta to continue issuing stablecoins.

At the same time, the development path of stablecoins in the Asian market may be different. Particularly, Southeast Asian countries are showing a strong interest in Central Bank Digital Currencies (CBDCs), which means that the integration of stablecoins and CBDCs will accelerate. This suggests that regional financial environments may lead to different growth patterns.

3.3. Accelerated Institutionalization of the Real-World Asset (RWA) Tokenization Market

Real-World Asset (RWA) tokenization is receiving increasing attention, seen as an important bridge between traditional finance and digital assets. The tokenization of various assets, including government bonds, real estate, and private equity funds, is creating innovative value by improving trading efficiency, lowering entry barriers, and providing 24/7 trading liquidity. This transformation has been greatly enhanced by the active participation of large asset management companies, significantly increasing market credibility and accelerating the influx of institutional investors.

Source: Bitwise

According to Bitwise's forecast, the RWA tokenization market is expected to reach $30 trillion by 2050. Hashed expects that the inflow of billions of dollars in liquidity led by industry giants like BlackRock and Franklin Templeton will drive the growth of the RWA market.

The Asian market is also starting to show signs of transformation. Government-led pilots are actively progressing, with Thailand, Indonesia, and Japan taking the lead in these developments.

3.4. Driving Financial Paradigm Innovation through the Convergence of Artificial Intelligence and Blockchain

The convergence of Artificial Intelligence (AI) and Blockchain is driving innovation in financial services. AI agents are expected to significantly lower the barriers to entry into the DeFi market by automating cryptocurrency wallet management, optimizing trades, and executing risk management. Furthermore, the development of decentralized AI learning networks will also make AI development more ubiquitous and distributed.

a16z crypto predicts that based on Trusted Execution Environments (TEEs), AI agents will evolve into fully autonomous economic entities. Delphi Digital expects that through frameworks like Virtuals and ai16z, on-chain autonomous economies will emerge, and these frameworks are anticipated to capture a significant share of DeFi transactions.

This trend has already shown early signs this year, with the market placing high hopes on David Sacks, the former PayPal COO and the White House's Crypto and AI Commissioner appointed by President Trump. However, as the actual results of the AI and cryptocurrency convergence are still limited, comprehensive government policy support may need to wait for more compelling outcomes to emerge.

3.5. Constructing a New Economic Paradigm through Decentralized Physical Infrastructure (DePIN)

Decentralized Physical Infrastructure (DePIN) is providing an innovative model for infrastructure sharing and management, utilizing Blockchain technology to balance efficient resource utilization and economic incentives. Through the DePIN architecture, individuals can earn rewards by providing infrastructure such as energy, communications, and computing resources.

According to Messari data, the market capitalization of DePIN grew by 132% in 2024, reaching $40 billion, and the industry revenue is expected to exceed $250 million in 2025. Galaxy predicts that by 2025, more than half of Bitcoin mining companies will partner with AI companies and high-performance computing service providers.

The Asian market has particularly high acceptance of DePIN, continuing the P2E (Play-to-Earn) trend. In regions with relatively low wage levels, high-yielding DePIN projects may give rise to specialized operating models similar to P2E game farms, perhaps even developing so-called "DePIN factories".

4. Conclusion

The cryptocurrency market has always been filled with dramatic transformations, and the first quarter of this year is no exception, with the market facing unprecedented volatility.

Reviewing the market's history, from the inception of Bitcoin, the market has experienced the ICO (Initial Coin Offering) boom triggered by the launch of Ethereum's ERC-20 standard, followed by the DeFi era represented by Uniswap, and the NFT craze initiated by CryptoPunks. In the gaming sector, Axie Infinity led the P2E (Play-to-Earn) trend, while the success of Dogecoin opened the way for the "meme coin" hype represented by Dogecoin and "cat coins". Concurrently, the rise of L2 scaling solutions is also a noteworthy development.

Recently, although AI projects have risen rapidly, Trump-related tokens have absorbed a significant amount of market liquidity, marking a new stage for the market.

This shows that the cryptocurrency market has undergone rapid transformations in its short history. While the core values of Bitcoin, such as "preventing infinite inflation" and "decentralization", still exist, the market continues to evolve in multiple directions. However, it is regrettable that truly time-tested projects that can consistently create value are few and far between.

Against this backdrop, the market should exercise cautious evaluation of the Trump administration's cryptocurrency policies, rather than being overly optimistic. Currently, Trump has signed 100 executive orders, but the integration of cryptocurrency policies is expected to take a relatively long time. Especially as the US economy continues to recover and the debt ratio declines, related policies may face stricter scrutiny.