Original Title: (Frontier Ideas For 2025)
Source: Multicoin Capital
Translation: BitpushNews
2025 is expected to be a key year for the crypto industry. The path to the first regulatory framework supporting cryptocurrencies, combined with the technological maturity of Layer 1 blockchains, DeFi protocols, DePIN networks, and stablecoins, creates fertile ground for the next wave of frontier innovation.
In keeping with our tradition, we will share the ideas and opportunities that excite us most in the coming year.
Decentralized Physical Infrastructure Network Robots (DePIN Robotic) and zero-employee companies
— Managing Partner Kyle Samani
DePIN Robotic — There are rumors that the incoming Trump administration will push to elevate self-driving (AD) regulation from the state level to the national level, creating a unified standard for autonomous driving companies. As the scale of GPU clusters continues to expand (e.g., over 100,000 H100 GPUs), transformer-based autonomous driving technology will become more mature and is expected to be widely applied in the real world. After this, I expect explosive growth in robot-based DePIN. Many startups have raised funds from non-crypto VCs but have not yet truly commercialized. I am optimistic that many of them will adopt the DePIN model, transferring risk from the balance sheets of developing companies to global robotic professionals and 'prosumers' (producers and consumers). Many early adopters of these robotic products will capture data critical to the development of autonomous robots. I know of one company in this space today — Frodobots — and I look forward to seeing more. Our portfolio company Hivemapper, while not explicitly a robotics company, is exploring many similar ideas.
Zero-employee companies — the foundation of zero-employee companies is artificial intelligence. With the help of OpenAI's o3 and other more advanced reasoning models, models are reaching a point where they can think, plan, execute, and self-correct. This lays the groundwork for AI agents to perform all tasks in business.
For zero-employee companies to function, they will require human guidance, as AI will inevitably make mistakes and may exceed its context window. Over time, I expect that as AI continually improves its self-correction and expands its context window, the level of human guidance will decrease. I believe the governance of these zero-employee companies may be conducted through DAOs, and I expect that crypto capital markets will fund the ambitious attempts of zero-employee companies.
Startups often succeed while large companies fail because they face unique constraints. I believe zero-employee constraints will lead to some incredible breakthroughs in all business operations.
On-chain securities
— Co-founder and Managing Partner Tushar Jain
With the Trump administration coming to power and the Republican party achieving full victory in Congress, on-chain securities have finally seen meaningful takeoff.
Transactions on blockchains like Solana can be completed almost instantaneously, eliminating the wait times common in traditional finance. Faster capital movement increases capital efficiency and should bring about more effective pricing.
Blockchain ensures that all participants can access real-time, immutable records of transactions. This level of transparency and security stands in stark contrast to the opaque and sometimes risky centralized databases of traditional financial institutions. Transaction costs on blockchain networks are significantly lower than those in traditional banking systems; a simple comparison of the cost of sending stablecoins on Solana ($0.001) versus sending a wire transfer ($30) illustrates this. Solana's token expansion now allows for precise fine-grained control over tokenized securities. Issuers can restrict their security holders to whitelisted addresses, recall tokens in the event of a court order, and comply with other securities laws or transfer agent requirements or best practices.
There is no doubt that the near-instant finality, cheap transactions, and transparency of blockchain provide better settlement than the slow, expensive, and opaque traditional financial rails. The only real barrier is regulation, and a more innovation-friendly SEC could open the door for the tokenization of securities.
I don't think public stocks will be the first tokenized securities adopted by the mass market. Markets that are less liquid, more opaque, and benefit more from tokenization are more likely to be adopted first. This could be startup equity, as there is no reason to pay Carta or Angelist to manage a cap table when blockchain can do it for free. It could be fixed income instruments that Figure has been studying for years. It could be LP interests in funds.
Buy Now, Pay Never — consume your portfolio, portfolio margin
— Investor Spencer Applebaum
Based on Tushar's ideas, when all assets are programmable and can be traded on-chain, we will start to see interesting new products emerge. Here are a few examples:
Buy Now, Pay Never — Affirm and Klarna have promoted the concept of buy now, pay later, and I believe you have seen these widgets on Amazon and other merchant sites. Today, on-chain users can earn about 8% on SOL and about 15% on stablecoins. What if users could deposit their tokens with merchants (from web2 companies like Netflix to web3 companies like Dune Analytics) without needing to prepay subscription fees, and merchants would earn staking/lending rewards over time? Users' tokens would be locked for a period to guarantee payment. We believe there is a strong consumer psychology factor here, where the opportunity cost of earnings seems more acceptable than prepayment.
Consume your portfolio — when all assets are tokenized and aggregated in one place (one web3 wallet), it makes sense for users to be able to pay for medium to large items with their portfolio. Imagine Alice has $10,000 in BTC, $10,000 in interest-bearing USDC, $10,000 in TSLA stock, and $10,000 in gold. She wants to buy a $4,000 sofa. She doesn't have to convert her USDC to fiat, wait for a bank transfer, send payment, and then reverse the process to rebalance her portfolio if she could automatically sell $1,000 of each of her four holdings on-chain and immediately pay the sofa merchant. She would still be fully allocated to her existing portfolio without needing to consider the rebalancing process.
Portfolio Margining — In the next 3-5 years, with the emergence of major crypto brokers and unified super protocols, users should be able to hold all assets across margin. For instance, Alice should be able to short BTC perpetual contracts using her AAPL stock and borrow USDC on-chain. Or she should be able to use her tokenized whiskey as collateral to purchase tokenized debt on-chain. We are beginning to see this in an integrated way (e.g., Ostium bringing forex trading on-chain), but it will become clearer as spot assets are tokenized.
On-chain validation of off-chain states
— Investment Partner Shayon Sengupta
Asset ledger systems like Bitcoin and Solana represent a key step in the development of cryptocurrency. These systems are fundamentally about money, enabling the storage and transfer of value through permissionless channels globally. Today, the cryptographic primitives that make these systems operate are beginning to cross-pollinate with non-ledger systems, unlocking entirely new markets. In the next 12 months, cryptography will establish itself as a validation layer for data and computation in three novel ways: network proofs, privacy-preserving data processing, and identity/media provenance.
I see this as a fusion of 'monetary cryptography' and 'verification cryptography,' which will serve as a coordination layer to spawn new economic models and incentive mechanisms.
Emerging Markets: Zero-Knowledge Proofs Unlock New Possibilities
The first opportunity is zkTLS and the market it brings. zkTLS refers to building zero-knowledge proofs through TLS signatures in web pages to verify any data unit on the internet in a completely untraceable and tamper-proof way (e.g., your credit score on Equifax or your Strava exercise history). Some teams have already started deploying zero-knowledge proofs in web sessions to build untraceable and anti-fraud applications. Our investment in p2p.me and ZkMe is an early example. p2p.me is a cash recharge/cash withdrawal platform in India that leverages network proofs to bypass the fractured market structure in the region. ZkMe is a sovereign verification KYC credential system that allows applications to verify user identities in a privacy-preserving manner. The same principles can also extend to dozens of new markets, such as ticketing, reservations, and other systems where fraud is a major liquidity bottleneck.
Homomorphic Encryption: Unlocking the Potential of AI
Secondly, fully homomorphic encryption (FHE) is about to enter its golden age. As the diminishing returns of AI systems trained on public datasets become apparent, post-training and fine-tuning in private or confidential environments will become increasingly critical. This creates a new design space for coordinating previously inaccessible datasets as inputs for models, especially as vast amounts of valuable enterprise and consumer data continue to shift from local to cloud systems. Token-based incentive mechanisms will play a key role at this layer, and breakthroughs in this area will elevate top foundational models.
Authentication and media provenance: essential tools for the AI era
In the post-AI era where content generation costs approach zero, authentication of identity and content authenticity will become indispensable elements in consumer applications. Early systems like Worldcoin, Humanity Protocol, and Humancode use cryptographic proofs to verify biometric information or state-issued credentials and leverage token incentives as the primary means for large-scale mobilization of participants. Similarly, standards like C2PA distinguish real captured media from AI-generated media by tagging content at the hardware level, but the large-scale adoption of these standards at the application layer may require some form of token-based coordination mechanism to overcome consumer habit inertia. These tools are crucial for addressing the information risks posed by an AI-saturated consumer internet.
Trading moves towards multi-faceted, full-stack media companies
— Investor Eli Qian
Trading moves towards multiplayer — sharing financial wins and losses and speculating collectively is a deeply ingrained human behavior that spreads easily. People are eager to talk about how much they have made (or lost!) in stocks, sports betting, and even meme coins. However, the currently popular cryptocurrency, stock, and sports betting trading platforms are mostly designed for single-player experiences. Robinhood, FanDuel, BONKBot — none of these prioritize multiplayer experiences. Nevertheless, the demand for social trading is undeniable. Today, users create their own ad-hoc social experiences through online forums and group chats. A significant portion of content on Crypto Twitter revolves around these discussions.
One of the biggest advantages of cryptocurrencies is permissionless liquidity. It opens the door for anyone to build multiplayer trading tools for crypto assets. I am very excited to see developers leverage the inherent viral characteristics of social trading to create multiplayer experiences in 2025. Such products will allow users to share trades, compete on profit and loss statements, and collaboratively build positions with a single click or tap. The design space is vast, covering Telegram bots, Twitter Blinks, Discord mini-apps, and more. While 2023 and 2024 witnessed the rise of single-player tools like BONKBot and BullX, 2025 will be a year where trading moves toward multiplayer gaming.
Full-stack media companies — People have tried multiple times to use tokens to enhance media and content, but few companies have been able to fully realize their potential. However, we are beginning to see the rise of media companies that control end-to-end content production, including tokens, distribution, and human capital. These 'full-stack' media companies have the ability to push the primitives of cryptocurrency further than ever before. For example: athlete tokens, creator tokens, live streams with prediction markets, etc.
One example is Karate Combat. It didn't build products around existing UFC fighters but instead created a new fighting league from scratch, giving them more control over rules, distribution, and athletes. While the utility of UFC fighters' tokens is limited, karate fighters could let token holders vote on training regimens, fight uniforms, or anything else — which is only possible if Karate Combat controls token design and fighter contracts.
The future of live streaming, sports leagues, podcasts, and reality shows will see deep vertical integration in terms of content, distribution, tokens, and human capital. I am very excited about investing in and consuming the next generation of token-enhanced media.
The rise of Alpha hunters
— Investor Vishal Kankani
2024 has seen some decisive events that herald interesting new phenomena emerging in 2025.
Firstly, issuing a new token requires almost no cost (around $0), and almost anyone can do it without permission. This has led to an astounding number of token issuances in 2024. Most of these issuances are meme coins, whose lifespans are measured in hours and are very short-lived.
Secondly, the market sentiment of 2024 has returned to a high throughput, low fully diluted valuation (FDV) fair distribution token issuance model — reminiscent of the initial coin offering (ICO) era in 2017. In this type of market, centralized exchanges (CEX) will struggle to keep up with the pace of new coin listings, and we expect this to continue into 2025 (as they have their own listing processes), which will incentivize people to turn to on-chain trading and bring more liquidity to decentralized exchanges (DEX). As the number of tokens and DEX trading activity explodes, active traders will need more robust tools and models to identify emerging tokens in real-time, analyze market sentiment and on-chain metrics, identify vulnerabilities, mitigate risks (such as rug pulls), and execute trades efficiently.
This leads us to the third thing happening in 2024: AI agents. So far, we have seen AI agents creating content on social media to attract attention to their respective tokens. I anticipate the next iteration of AI agents will be 'alpha hunters' — meaning their sole task will be to seek out excess returns (alpha) and autonomously trade in real-time.
The wave of crypto institutionalization
— Partner Matt Shapiro
We are entering the beginning of the institutionalization phase of cryptocurrencies, and this process will happen at an astonishing speed.
Over the past five years, the crypto industry has made significant strides in major technological advancements, product-market fit, and substantial user interface/user experience (UI/UX) improvements, yet the institutional cohort has essentially stagnated in the cryptocurrency space. The combination of regulatory and career risks has made it difficult for many financial institutions to effectively enter the space, let alone offer even the most basic crypto products to their clients. With the advent of a crypto-friendly government in the U.S. and the record success of Bitcoin ETFs, we are about to see the complacency of institutions from the past five years scrambling to catch up and find ways to support cryptocurrencies as quickly as possible.
In 2024, there will be a $35 billion demand for Bitcoin purchases that cannot or will not simply go through Coinbase. As most asset management firms and large brokerages have yet to fully launch crypto operations, by 2025, more capital will be able to enter the cryptocurrency market. We will see a plethora of ETFs launched to meet and capitalize on this demand. This will include ETFs for new crypto assets like Solana (SOL), as well as ETFs that hold a mix of various crypto assets and blend crypto assets with traditional assets like gold, stocks, or credit. There will be leveraged ETFs, inverse ETFs, volatility suppression ETFs, staking ETFs, etc. Essentially, all combinations that bundle crypto assets for institutional and retail investors will be explored.
We will see major financial institutions competing to launch basic financial products around cryptocurrencies. Each financial institution should explore creating product lines that allow its customers to trade cryptocurrency products. Financial institutions should seek to custody crypto assets and provide credit against these assets as they do today for more traditional assets. We may also see a significant increase in stablecoin issuers. Any bank that accepts deposits should seek to issue local stablecoins. In my conversation with Visa's Cuy Sheffield at the 2024 Multicoin Summit, I emphasized that every company needs a stablecoin strategy, just as 'e-commerce' eventually integrated into 'business,' 'stablecoins' will gradually integrate into all aspects of business, becoming an indispensable part of commercial activities.
These are just the tip of the iceberg; while this may not be the most ambitious thing technically in the crypto space, the scale and scope of its distribution and the funds involved are massive.
