Grayscale Research released a new report today detailing its predictions for the top-performing crypto sectors in Q1 2025. The tail end of 2024 brought in massive success, helping create a sense of competition and vitality in the space.
The firm’s report concludes that smart contracts have more potential and dynamic energy than any other. Still, a few heavy hitters like tokenization and DePin have also attracted Grayscale Research’s interest.
Grayscale Report Highlights Strong Competition in the Smart Contract Market
Grayscale, one of the leading Bitcoin ETF issuers, released this report with several comments on its main predictions. The firm concluded that crypto markets soared in Q4 2024 and that fierce competition between smart contract platforms has been a major growth facilitator. It also provided a “Top 20” list of highest-performing DeFi/Web3/crypto investment options.
Grayscale Research’s Top 20. Source: Grayscale
The firm called smart contracts “the most competitive market segment in the digital assets industry,” noting that Ethereum underperformed despite landmark victories like the ETF and a substantial software upgrade. Instead, competitors like Solana, Sui, and TON ate up their market share, highlighting the dynamic energy of this sector.
Grayscale puts the highest expectations on smart contracts. However, only a few of its Top 20 assets fall into this category, and this doesn’t even include the leading asset. Other areas of interest include several that were high-interest in the last report, such as scaling solutions, tokenization, and DePin.
“Regardless of design choices and a network’s strengths and weaknesses, one way smart contract platforms derive their value is through their ability to generate network fee revenue. The greater the ability of a network to generate fee revenue, the greater the network’s ability to pass on value to the network in the form of token burn or staking rewards. This quarter, the Grayscale Research Top 20 features the following smart contract platforms: ETH, SOL, SUI, and OP,” the report noted.
The company is a subsidiary of the Digital Currency Group (DCG), and has a long history within the crypto space. Grayscale led the legal effort for a Bitcoin ETF, which succeeded in January 2024, although the firm quickly lost dominance over the new market.
Despite this setback, it has still been a pioneer in gaining SEC approvals for Ethereum ETFs and new ETF options trading. Ultimately, the firm’s ability to sell a successful ETF has little bearing on its capacity to critically assess market potential.
Admittedly, though, Grayscale Research’s Q1 2025 report barely mentions the ETF space, presumably considering it tangentially relevant to the main fundamentals. In any event, Grayscale is significantly optimistic about crypto’s future.
