Compiled: Vernacular Blockchain
Mark Greenberg, Head of Global Consumer Business at Kraken
Looking to 2025, cryptocurrency will play an increasingly important role in shaping the changing financial landscape. From its gradual inclusion in diversified portfolios to the development of blockchain-driven financial services, cryptocurrency continues to have a profound impact on traditional finance.
This year, with the continued growth of trust, accessibility, and innovation, cryptocurrency will achieve deeper integration into mainstream financial strategies. Here are six trends I am most concerned about for the upcoming 2025.
1. Cryptocurrency becomes an essential component of an ideal portfolio.
The historically asymmetric return characteristics of cryptocurrency have made it increasingly difficult for investors to justify not including it in their portfolios.
In 2025, strategies like Dollar-Cost Averaging (DCA) will continue to gain favor, allowing investors to start with small investments and gradually increase their holdings. I expect that methods to facilitate gradual familiarity with this asset class will accelerate in the new year.
2. Crypto platforms will focus on providing customers with medium- to long-term wealth accumulation strategies, with trust as the key differentiating factor.
In 2025, exchanges and crypto platforms will shift product strategies to offer customers plans for medium- to long-term wealth accumulation. The foundation of these services will be earning returns through stablecoin holdings, layered with more complex products and services.
In light of the lessons learned from the collapses of FTX, Celsius, and Voyager during the last cycle, customers will pay more attention to the trustworthiness, security, and durability of platforms when choosing how to access these opportunities.
3. The stablecoin market will welcome the first real challenge to existing giants, and users will become the primary beneficiaries.
The stablecoin market has long been dominated by Tether and USDC, and this is no secret. In 2025, these two giants will face real competition for the first time as a new generation of stablecoins will launch, challenging the existing leaders with regulatory and regional advantages.
This competition will bring affordability to users, who will have more tools to manage digital fiat currencies, while the adoption of alternative tokens will also help manage counterparty risks of stablecoin issuers.
4. Bitcoin will gain more mainstream attention during inflation rebounds.
Some analysts predict that inflation may remain above the Federal Reserve's 2% target for an extended period. Over the past few years, everyone in Western countries has experienced the continuous decline in the value of fiat currencies for the first time since the 1970s.
Bitcoin's fixed supply - something that gold cannot offer - may drive more mainstream recognition of its anti-inflation value proposition. This will encourage more people to adopt Bitcoin as a store of value to protect wealth in the context of fiat currency depreciation.
5. Reduced volatility in the crypto market.
Over the past decade, the overall volatility of cryptocurrency has been on a downward trend. This is because increased adoption has brought more liquidity, making the market less susceptible to severe price fluctuations.
As ETFs allow more investors to access cryptocurrency, we expect the volatility of the crypto market to continue to decline. This could make cryptocurrency more attractive to investors with higher risk tolerance (and support strategies like Dollar-Cost Averaging).
6. A new generation of banking services based on cryptocurrency goes mainstream.
We have begun to see new investment products - such as money market funds - being launched on different blockchains. Traditional financial institutions have recognized and are leveraging the efficiency gains brought by this technology, as well as its ability to open up products for entirely new markets.
In 2025, I expect more familiar financial products to be built and brought to market on blockchain - including payments, regular savings, high-yield savings accounts, credit cards, lending, and more.
7. Summary: 2025: Cryptocurrency steps onto the main stage.
In 2025, the maturation of the cryptocurrency market will bring a whole new opportunity and stability for investors and institutions. Whether it's Bitcoin as a mainstream store of value, the emergence of competitive stablecoins, or platforms prioritizing long-term wealth accumulation strategies, the influence of cryptocurrency will further expand into the financial world.
With trust and accessibility at its core, this year will become a turning point for cryptocurrency to solidify its position as an important pillar in the modern financial ecosystem.
