Source: Multicoin Capital
Compiled by: BitpushNews
2025 is poised to be a critical year for the crypto industry. The path toward the first regulatory framework supporting cryptocurrencies, coupled 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 the regulation of autonomous driving (AD) from the state level to the national level, creating a unified standard for autonomous driving companies. As the scale of GPU clusters continues to grow (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 that, I expect explosive growth in robot-based DePIN. Many startups have already raised funds from non-crypto VCs but have not yet truly begun commercialization. I am optimistic that many of them will adopt the DePIN model, transferring risk from the development companies' balance sheets to global robot professionals and 'prosumers' (producers and consumers). Many early adopters of these robotic products will capture critical data for developing autonomous robots. I know of one company in this field today—Frodobots—and I look forward to 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 thought chain reasoning models, these models are reaching a level where they can think, plan, execute, and self-correct. This lays the groundwork for AI agents to perform all tasks in business.
To make zero employee companies operate normally, human guidance will be needed, as AI will inevitably make mistakes and may exceed its context window. Over time, I expect that as AI continues to improve self-correction and expand its context window, the degree of human guidance will decrease. I believe the governance of these zero employee companies could possibly be conducted through DAOs, and I expect that the crypto capital markets will fund the ambitious attempts of zero employee companies.
Startups often succeed while large companies fail due to unique constraints they face. I believe the zero employee constraint will bring some incredible breakthroughs to all business operations.
On-chain securities
—Co-founder and Managing Partner Tushar Jain
With the Trump administration coming to power and the Republican Party's sweeping victory in Congress, on-chain securities have finally ushered in meaningful takeoff.
Transactions on blockchains like Solana can be completed almost instantly, eliminating the common wait times found in traditional finance. Faster capital flow increases capital efficiency and should lead to more effective pricing.
Blockchain ensures that all participants have access to real-time, immutable records of transactions. This level of transparency and security starkly contrasts with the opaque and sometimes risky centralized databases of traditional financial institutions. The transaction costs on blockchain networks are far lower than in traditional banking systems, as evidenced by comparing the cost of sending stablecoins on Solana ($0.001) to the cost of sending wire transfers ($30). Solana's token expansion now allows for precise, granular control over tokenized securities. Issuers can restrict their security holders to whitelisted addresses, recall tokens under 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, inexpensive transactions, and transparency of blockchain provide better settlement than the slow, expensive, and opaque traditional financial tracks. The only real barrier is regulation, and a more innovation-friendly SEC could open doors for the tokenization of securities.
I don't think publicly traded stocks will be the first tokenized securities adopted by the mass market. Markets that are less liquid, more opaque, and would benefit more from tokenization are more likely to be adopted first. This could be startup equity, as there’s no reason to pay Carta or Angelist to manage a capitalization table when blockchain can do it for free. It could be fixed-income instruments that Figure has been researching for years. It could be LP interests in funds.
Buy Now, Pay Never, Consume Your Portfolio, Portfolio Margining
—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 popularized the concept of buy now, pay later, and I believe you have seen these widgets on Amazon and other merchant sites. Nowadays, on-chain users can earn about 8% on SOL and about 15% on stablecoins. What if users do not need to pay subscription fees upfront but can deposit their tokens with merchants (from web2 companies like Netflix to web3 companies like Dune Analytics), and merchants earn staking/lending rewards over time? Users' tokens will be locked for a period to guarantee payment. We believe there's a strong consumer psychology factor here; the opportunity cost of earnings seems more acceptable than prepayments.
Consume Your Portfolio—When all assets are tokenized and aggregated in one place (a web3 wallet), users should be able to use their portfolio to pay for mid- to large-ticket items, which makes sense. 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 go through the reverse process to rebalance her portfolio if she can automatically sell $1,000 from each of her four holdings on-chain and immediately pay the sofa merchant. She remains fully allocated to her existing portfolio without needing to think about the rebalancing process.
Portfolio Margining—In the next 3-5 years, with the emergence of major cryptocurrency brokers and unified super protocols, users should be able to hold all assets across margin. For example, 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 starting to see this in an integrated way (e.g., Ostium bringing forex trading on-chain), but it will become clearer when spot assets are tokenized.
On-chain verification of off-chain states
—Investment Partner Shayon Sengupta
Asset ledger systems like Bitcoin and Solana represent a key step in the evolution of cryptocurrencies. These systems fundamentally pertain to money, achieving value storage and transfer through permissionless channels on a global scale. Today, the cryptographic primitives that enable these systems are beginning to intersect with non-ledger systems, unlocking entirely new markets. In the next 12 months, cryptography will establish itself as a verification layer for data and computation through three novel methods: network proofs, privacy-preserving data processing, and identity/media provenance.
I see it as a fusion of 'currency cryptography' and 'verification cryptography' that will serve as a coordinating layer, spawning 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 via TLS signatures in web pages to verify any data unit on the internet in a completely untraceable and tamper-proof manner (e.g., your credit score on Equifax or your Strava activity history). Some teams have already begun deploying zero-knowledge proofs in web sessions to build untraceable and anti-fraud applications. Our investments in p2p.me and ZkMe are early cases of this. p2p.me is a cash recharge/cash withdrawal platform in India that uses network proofs to bypass the region's broken market structure. ZkMe is a sovereign verification KYC credential system that allows applications to verify user identities in a privacy-preserving manner. The same principle can be extended to dozens of new markets, such as ticketing, bookings, and other systems where fraud is a major liquidity bottleneck.
Homomorphic Encryption: Unlocking the Potential of Artificial Intelligence
Secondly, Fully Homomorphic Encryption (FHE) is entering its golden age. As the training returns of AI systems on public datasets diminish, post-training and fine-tuning in private or confidential environments will become increasingly critical. This creates a whole new design space for coordinating datasets that were previously inaccessible as inputs to 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 field will elevate top foundational models.
Authentication and Media Provenance: Essential Tools for the AI Era
In the post-AI era, where content generation costs are nearing zero, verifying the authenticity of identity and content will become an indispensable element in consumer applications. Early systems like Worldcoin, Humanity Protocol, and Humancode use cryptographic proofs to verify biometric information or government-issued credentials, leveraging token incentives as the primary means of mobilizing participants at scale. Similarly, standards like C2PA distinguish between genuinely captured media and AI-generated media by marking content at the hardware layer, 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 of an AI-saturated consumer internet.
Trading moves towards multi-faceted, full-stack media companies
—Investor Eli Qian
Trading moves toward multiplayer gaming—sharing financial gains and losses and speculating collectively is a deeply human, easily spread behavior. People love to discuss how much they made (or lost!) in stocks, sports betting, and even meme coins. However, the current popular cryptocurrency, stock, and sports betting trading platforms are mostly designed for single-user experiences. Robinhood, FanDuel, BONKBot—none of these prioritize multiplayer gaming 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 the 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 multi-user trading tools for crypto assets. I am very much looking forward to seeing developers harness the viral spread inherent in social trading to create multi-user experiences in 2025. Such products will allow users to share trades, compete on profit and loss sheets, and jointly 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-user tools like BONKBot and BullX, 2025 will be the year trading moves towards multiplayer gaming.
Full-Stack Media Companies—People have tried many 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 creation, 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 broadcasts with prediction markets, and so on.
One example is Karate Combat. It doesn't build products around existing UFC fighters but instead establishes 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 combat allows token holders to vote on fighters' training regimens, fight attire, or anything else—something that is only possible if karate combat controls token design and fighter contracts.
Future live broadcasts, sports leagues, podcasts, and reality shows will achieve deep vertical integration in terms of content, distribution, tokens, and human capital. I am very much looking forward to investing in and consuming the next generation of token-enhanced media.
The Rise of Alpha Hunters
—Investor Vishal Kankani
2024 will witness a few decisive events that herald some interesting new phenomena in 2025.
First, issuing a new token costs almost nothing (around $0) and can be done permissionlessly by almost anyone. This has led to an astonishing number of token issuances in 2024. Most of these issuances are meme coins, whose lifecycles are measured in hours and are extremely short-lived.
Secondly, the market sentiment of 2024 has returned to high throughput, low fully diluted valuations (FDV) and fair distribution token issuance models—reminiscent of the ICO era of 2017. In such a market, centralized exchanges (CEX) struggle to keep up with the pace of new token listings, and we expect this to continue in 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). Therefore, DEX will gain more market share from CEX in the next year. With the explosive growth of token numbers and DEX trading activity, 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 (e.g., exit scams), and execute trades efficiently.
This leads 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 expect the next iteration of AI agents to be 'Alpha Hunters'—that is, 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 cryptocurrency, and this process will happen at an astonishing pace.
Over the past five years, the crypto industry has made significant strides in technological advancements, product-market fit, and substantial user interface/user experience (UI/UX) improvements, but the institutional cohort has actually stagnated in the cryptocurrency space. The combination of regulatory and career risks has made it difficult for many financial institutions to effectively enter this field and even offer their clients the most basic crypto products. With the rise of a pro-crypto 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 racing to catch up and find ways to support cryptocurrencies as quickly as possible.
In 2024, there will be $35 billion in Bitcoin buying demand that can't or won't simply go through Coinbase. As most asset management firms and large brokers have not fully launched crypto operations, by 2025, there will be more funds able to enter the cryptocurrency market. We will see a large number of ETFs launched to meet and take advantage of this demand. This will include ETFs for new crypto assets like Solana (SOL), ETFs that hold multiple crypto assets, and ETFs that mix crypto assets with traditional assets like gold, stocks, or credit. There will be leveraged ETFs, inverse ETFs, volatility suppression ETFs, staking ETFs, and more. Basically, all combinations of crypto assets bundled together for institutional and retail investors will be explored.
We will see major financial institutions racing to launch fundamental financial products around cryptocurrencies. Each financial institution should explore creating product lines that enable their clients to trade crypto products. Financial institutions should seek to custody crypto assets and provide credit against these assets as they do today with more traditional assets. We may also see a significant increase in stablecoin issuers. Any bank that accepts deposits should seek to issue local stablecoins. I emphasized in my conversation with Visa's Cuy Sheffield at the 2024 Multicoin Summit that every company needs a stablecoin strategy, just as 'e-commerce' eventually integrated into 'commerce,' 'stablecoins' will gradually become an integral part of business activities.
These are just the tip of the iceberg; while this may not be the most technically ambitious thing in the crypto space, the scale and scope of its distribution and the capital involved are massive.
