Coinbase recently released a report highlighting predictions for the cryptocurrency market in 2025. The report focuses on key areas such as stablecoins, tokenization, ETFs, DeFi, and regulatory developments.
Reports from other industry participants also suggest a positive outlook for the crypto market in 2025.
Favorable regulatory environment will drive market growth
The first major prediction highlights that regulatory changes will benefit the crypto market as a whole. Coinbase refers to the upcoming US Congress as “The Most Pro-Crypto US Congress… Ever.” Among the possible developments, the creation of a Bitcoin Strategic Reserve could become a reality.
Pro-crypto seats in the US Senate and House of Representatives. Source: Coinbase.
Still, pro-crypto movements are not limited to the US; regions such as Europe, the G20, the UK, the UAE, Hong Kong, and Singapore are actively developing regulations to support digital assets.
Furthermore, Binance CEO Richard Teng also predicts that regulatory changes in the US will act as a catalyst for growth in 2025, with other countries likely to follow suit.
Positive developments for crypto ETFs
Additionally, Coinbase highlights the importance of Bitcoin and Ethereum ETFs in attracting new capital. Data reveals that net inflows have reached $30.7 billion since their introduction.
Weekly net flows into crypto ETFs in the US. Source: Coinbase
The report also suggests that ETFs tied to assets such as XRP, SOL, LTC, and HBAR could gain approval, although their benefits may be short-term.
The exchange further speculates that the SEC may approve ETF staking, potentially expanding the market. SEC Commissioner Hester Peirce suggested that such developments could occur “early on.”
Global adoption of stablecoins
Coinbase projects a highly optimistic outlook for stablecoin adoption. With a market cap of over $190 billion, stablecoins currently account for 0.9% of the U.S. M2 money supply.
US M2 Money Supply vs Stablecoin Market Cap. Source: Coinbase
The report anticipates that stablecoins could grow to comprise 14% of the US’s $21 trillion M2 supply, driven by their speed and cost efficiency compared to traditional methods.
We may be very close to the day when the first and main use cases for stablecoins will not be just trading, but global capital flows and commerce, says the Coinbase report.
Tokenization thrives amid regulatory challenges
Coinbase expects tokenized assets to continue growing in 2025. The market cap of tokenized real-world assets (RWA) has grown by over 60% in the past year, reaching nearly $14 billion.
Estimates suggest that RWA capitalization could increase by at least $2 trillion in the next five years, driven by traditional financial giants such as BlackRock and Franklin Templeton.
Market Capitalization of Tokenized Assets by Asset Class (ex-stablecoins). Source: Coinbase
The tokenization trend extends beyond traditional assets like U.S. Treasuries and money market funds to areas like private credit, commodities, corporate bonds, real estate and insurance.
“We believe tokenization can simplify the entire portfolio construction and investment process by bringing it to the blockchain, although this may still take a few years. Of course, such efforts face their own unique challenges, including the fragmentation of liquidity across multiple blockchains and persistent regulatory hurdles,” Coinbase notes.
A report from Messari echoes these sentiments, predicting that Bitcoin and tokenized RWAs will dominate discussions by 2025.
DeFi is set to recover in 2025
Despite the market cap surpassing $3.7 trillion, DeFi’s total value locked (TVL) has yet to regain its previous peak of $200 billion; it currently stands at $120 billion.
DeFi Total Value Locked. Source: DefiLlama
Coinbase further argues that DeFi faced significant challenges in the last cycle, as many protocols offered unsustainable yields. However, regulatory changes in the U.S. could allow DeFi protocols to share revenue with token holders, sparking a revival.
The report also references comments from Federal Reserve Governor Christopher Waller, who stated that DeFi can complement centralized finance (CeFi) with distributed ledger technology (DLT) by improving the efficiency of data storage.
The article Coinbase's Five Predictions for the Crypto Market in 2025 appeared first on BeInCrypto Brasil.
