Coinbase's latest market outlook report for 2025 identifies three main trends: the development of Real World Assets (RWA), the revival of decentralized finance (DeFi), and a regulatory shift towards supporting cryptocurrencies in the US.
Coinbase predicts that 2025 will be a decisive year for cryptocurrency legislation in the US, after years of ambiguity in regulations. The exchange believes these changes could redefine how cryptocurrencies integrate into traditional financial and legal systems in the coming year.
Regulation supporting cryptocurrencies
According to Coinbase, the majority of bipartisan members supporting cryptocurrencies in the US Congress is a sign of positive change, helping to transform regulatory frameworks from barriers into catalysts for industry growth. Additionally, the initiative to establish a Strategic Bitcoin Reserve further reinforces the growing crypto support from lawmakers.
In August, Senator Cynthia Lummis proposed this idea, followed by Pennsylvania's consideration of the Strategic Bitcoin Reserve Bill, allowing the state to allocate up to 10% of its general budget to cryptocurrencies.
Although there are still many legal challenges, these initiatives reflect a growing interest from the government in integrating Bitcoin into national financial strategies. Internationally, jurisdictions like the European Union, through the MiCA regulation, and financial hubs like the UAE, Hong Kong, and Singapore are also establishing legal frameworks to promote innovation, contributing to increased acceptance and creativity in the industry.
A $30 trillion opportunity
Real World Assets (RWA) have garnered significant attention in 2024, as this market grew over 60%, reaching $13.5 billion in December. The industry is projected to expand to between $2 trillion and $30 trillion over the next five years.
The report indicates that traditional financial institutions are increasingly embracing tokenization, adopting blockchain technology to facilitate near-instant transactions and operate 24/7 trading. The scope of tokenization is widening, including government securities, private credit, commodities, corporate bonds, and even real estate.
Despite many challenges, particularly the fragmentation of liquidity across different blockchains, the report indicates that improvements in this area will help make tokenization an effective tool for streamlining investment processes and building portfolios.
DeFi recreates value
After a challenging cycle with unsustainable practices, DeFi is now transitioning into a more mature phase with higher transparency. Coinbase points out that the combination of off-chain and on-chain capital markets is a key factor driving DeFi's recovery.
The change in the regulatory environment in the US could be a decisive factor in creating frameworks for stablecoin regulation and facilitating access to DeFi for organizations. Currently, decentralized exchanges account for up to 14% of the trading volume of centralized exchanges, compared to only 8% at the beginning of 2023, reflecting a significant increase in acceptance.
The Governor of the US Federal Reserve, Christopher Waller, also affirmed the complementary role of DeFi to centralized finance, adding to the feasibility of this sector. Furthermore, new technologies such as smart contracts and stablecoins are increasingly seen as effective tools for optimizing efficiency and minimizing risks in traditional financial systems.
Stablecoins and ETFs
Stablecoins and crypto ETFs have seen strong growth in 2024, and Coinbase predicts these will be prominent themes in 2025.
The market capitalization of stablecoins has increased by 48%, reaching $193 billion, with projections that the industry could reach $3 trillion by 2030. Stablecoins are increasingly proving their important role in supporting fast, low-cost payments and meeting global financial needs, contributing to the foundation for future cryptocurrency acceptance.
Meanwhile, spot Bitcoin and Ethereum ETFs, launched in 2024, have attracted significant interest from institutions, with total net inflows nearing $40 billion in under a year. New initiatives like the creation and buyback of ETFs could enhance efficiency and reduce costs, further solidifying their role in the cryptocurrency ecosystem.
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