Original Source: Delphi Digital
Original Compilation: Stacy Muur, Crypto Researcher
Original Translation: Deep Tide TechFlow
Introduction
As the year comes to a close, various studies and predictions flood in. @Delphi_Digital recently released (2025 Market Outlook), providing an in-depth analysis of the current market conditions and future trends, covering a series of topics including Bitcoin price movements, major trends, and risk factors.
Given the length of the full text, it requires a significant amount of time to read in its entirety. Deep Tide TechFlow hereby compiles the core insights from Stacy Muur's article on (2025 Market Outlook).
This article divides the Delphi Digital report into three main parts: the rise of Bitcoin, the bubble of altcoin season, and trends for future development. Currently, Bitcoin's market cap has reached approximately $2 trillion, while the performance of altcoins has been lackluster. Looking ahead, the growth of stablecoins may bring hope for market recovery. At the end of the article, Stacy Muur also shares her unique insights on the cryptocurrency market in 2025, suggesting that the crypto market is evolving from the 'Wild West' into a more regulated alternative stock market. Web3 native users are willing to take on high risks and participate in speculative trading, while newcomers may adopt more prudent risk management, focusing on long-term value, causing some narratives to be marginalized.
The Rise of Bitcoin
Once upon a time, a Bitcoin price of $100,000 was considered fanciful.
And now, this perspective has undergone a dramatic change. Bitcoin's current market cap is approximately $2 trillion—impressive. If Bitcoin were viewed as a publicly listed company, it would become the sixth most valuable company in the world.
Although Bitcoin has attracted widespread attention, its growth potential remains immense:
· BTC's market cap accounts for only 11% of the total market cap of MAG7 (Apple, Nvidia, Microsoft, Amazon, Google's parent company Alphabet, Meta, and Tesla).
· It accounts for less than 3% of the total market cap of the U.S. stock market and about 1.5% of the total market cap of the global stock market.
· Its market cap is only 5% of the total U.S. public debt and less than 0.7% of the global (public + private) debt.
· The total amount of funds in U.S. money market funds is three times that of Bitcoin's market cap.
· Bitcoin's market value is only about 15% of the total global foreign exchange reserve assets. If central banks globally invest 5% of their gold reserves in Bitcoin, it would bring over $150 billion in purchasing power to Bitcoin—three times the net inflow of IBIT this year.
· Current global household net worth has reached a record high of over $160 trillion, which is $40 trillion higher than the pre-pandemic peak. This growth is primarily driven by rising housing prices and a booming stock market. In contrast, this figure is 80 times Bitcoin's current market cap.
In a world where the Federal Reserve and other central banks push for a 5-7% annual depreciation of currency, investors need to pursue a 10-15% annual return to offset future purchasing power losses.
What you need to know:
· If currency depreciates by 5% annually, its real value will halve in 14 years.
· If the depreciation rate is 7%, this process will shorten to 10 years.
This is precisely why Bitcoin and other high-growth sectors are drawing so much attention.
The Bubble of Altcoin Season
Despite Bitcoin setting one historical high after another this year, 2024 is not friendly for most altcoins.
· $ETH failed to break the historical high.
· $SOL, while setting new highs, only increased by a few dollars compared to previous highs, which seems insignificant compared to its market cap and network activity growth.
· $ARB performed strongly at the beginning of the year, but its performance gradually declined as the year came to a close.
There are many similar examples. Just look at the performance data of 90% of the altcoins in your portfolio.
Why is this happening?
First, Bitcoin's dominance is a key factor. BTC has performed exceptionally well this year, driven by ETF inflows and factors related to Trump, with its price rising over 130% year-to-date, reaching its highest dominance level in three years.
Secondly, there is market differentiation.
This year's market differentiation is a new feature of the crypto market. In previous cycles, asset prices typically fluctuated in sync. When BTC rose by 1%, ETH usually rose by 2%, and altcoins rose by 3%, forming a predictable pattern. However, this cycle is vastly different.
Despite a few assets performing exceptionally well, more assets remain in a state of loss. The rise of Bitcoin has not driven a comprehensive increase in the prices of other assets, and the anticipated 'altcoin season' has not materialized.
Finally, Meme coins and AI agents (AI Agents) also play important roles in this.
The crypto market oscillates between 'this is a Ponzi scheme' and 'this technology will change the world.' In 2024, the narrative of 'scam' is dominating.
In the collective imagination of the public, the crypto market oscillates between 'a unified global financial system of future technology' and 'the largest scam in human history,' occurring every two years.
Why does this narrative seem to cycle between two extremes and happen every two years?
The Supercycle of Meme Coins and Market Sentiment
The supercycle of Meme coins further reinforces the perception of the crypto market as a 'Ponzi scheme.' Many people begin to question whether the fundamentals of the crypto market really matter, even viewing it as a 'casino on Mars.' These concerns are not unfounded.
In this context, I would like to add a comment.
When Meme is touted as the best-performing asset of the year, people typically only focus on the 'mainstream Memes' (like DOGE, SHIB) that already have significant market caps and successfully built communities. However, 95% of Memes quickly lose value after launch, which is often overlooked. Yet, even so, people still 'want to believe.'
This belief has prompted many funds that previously invested in altcoins to shift towards Memecoins—where a few profit, but most do not succeed. Consequently, capital inflows are primarily concentrated between Bitcoin (institutional funds) and Memecoins (high-risk investments), while the majority of altcoins are ignored.
Delphi believes that 2025 will be a year of technology-driven market transformation, with these technologies 'changing the world.'
Personally, however, I am not so optimistic about this. In 2024, a large number of KOLs (Key Opinion Leaders) focusing on Memecoins have emerged. When I tried to create a folder on Telegram containing channels of 'real value' (you can find it here), I found that almost all channels were discussing 'ape calls' (i.e., high-risk short-term investment suggestions). This is the essence of the attention economy, and these narratives profoundly influence market trends.
What is the next trend?
Growth of Stablecoins and Credit Expansion
One major challenge facing the current market is the oversupply of tokens. Driven by private investments and public token offerings, a large number of new assets have flooded in. For example, over 4 million tokens were launched on Solana's pump.fun platform alone in 2024. However, in contrast, the total market cap of the crypto market has only tripled compared to the previous cycle, while it grew by 18 times and 10 times in 2017 and 2020 respectively.
The two key factors missing from the market—stablecoin growth and credit expansion—are re-emerging. With declining interest rates and an improving regulatory environment, speculative behavior is expected to become active again, alleviating the current market imbalance. The core role of stablecoins in trading and collateral will be crucial for market recovery.
Institutional Capital Inflows
Until last year, institutional investors remained cautious about crypto assets due to regulatory uncertainties. However, with the SEC reluctantly approving spot Bitcoin ETFs, this situation is beginning to change, paving the way for future institutional capital inflows.
Institutional investors typically prefer to choose familiar investment areas. While a few institutions may venture into Memecoins, they are more likely to focus on assets with more fundamental support, such as ETH/SOL, DeFi, or infrastructure.
Delphi predicts that the market may see a 'broad rebound' similar to previous cycles in the coming year. Unlike before, this time the market will focus more on fundamentally driven projects. For instance, OG DeFi projects (original decentralized finance projects) with a proven record in the market may become a focal point; infrastructure assets (like L1 protocols) may also shine again. Additionally, RWA (Real World Assets) or emerging fields (such as artificial intelligence and DePIN) may also become hotspots.
Of course, not all tokens can achieve triple-digit gains as in the past, but the existence of Meme tokens will become part of the market. This may mark a new starting point for a broad crypto rebound driven by an overall market rise.
Comment: Most institutional traders typically rely on options hedging strategies. Therefore, if a 'broad rebound' occurs, the assets most likely to attract institutional interest will be those with options trading—currently primarily traded on Deribit and possibly Aevo platforms.
Arguments Regarding Solana
@Solana has demonstrated the strong resilience of the blockchain ecosystem. After experiencing a 96% market cap drop due to the FTX collapse, Solana is welcoming a remarkable recovery in 2024.
Here are its key performance highlights:
· Developer Momentum: By hosting hackathons and distributing airdrops (such as the Jito airdrop), Solana has successfully rekindled the interest of developers and users. This increase in participation has not only driven innovation but also formed a virtuous cycle of technological development and user adoption.
· Market Leadership: In the 2024 crypto market trend, Solana is leading in both Meme and AI application areas. Notably, its Real Economic Value (REV, a comprehensive measure of transaction fees and MEV) exceeds Ethereum by more than 200%, demonstrating strong market vitality.
· Future Outlook: Solana is seen as having the potential to challenge Ethereum's dominance in terms of scalability and user experience. Compared to decentralized Layer-2 solutions, Solana offers a seamless user experience and a highly centralized ecosystem, which gives it a significant competitive advantage.
Stacy's Final Thoughts
The current market situation may remind one of 2017-2018, when Bitcoin reached its historic high of $20,000 on New Year's Eve, only to begin a decline in early 2018. However, I believe it is inappropriate to compare the 2018 crypto market with that of 2025. They exist in completely different market environments—the once chaotic 'Wild West' is rapidly evolving into a more regulated alternative stock market.
We need to recognize that the scope of the crypto market extends far beyond the discussions in Crypto Twitter (CT) and X platform. For those not active on these platforms, their understanding and perception of the market may be completely different.
Looking ahead to 2025, I believe the crypto market will diverge into two main directions:
· Web3 Native Users: This group is deeply engaged in the crypto market, familiar with its unique operational methods, and willing to take on high risks to participate in speculative trades involving Meme, AI agents, and presale projects. These behaviors evoke memories of the early 'Wild West' era of the crypto market.
· Average Investors: Including institutional and retail investors, they typically adopt more prudent risk management methods and tend to focus on fundamental investment strategies. They view the crypto market as an alternative to traditional stock markets, emphasizing long-term value over short-term speculation.
So, which areas might be marginalized? Early DeFi projects, RWA (Real World Assets), and DePIN (Decentralized IoT) protocols that have failed to secure a leading position in their fields or within the blockchain ecosystem may gradually lose market attention. This is just my opinion.
PS: This article summarizes the key points from @Delphi_Digital's 2025 Market Outlook. If you want a comprehensive understanding of Delphi's detailed predictions for 2025 and beyond, I highly recommend reading their original research report.
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