Original Title: 5 Metrics to Watch in 2025
Original Author: Daren Matsuoka
Original Source: https://a16zcrypto.com/
Compiled by: Daisy, Mars Finance
2024 could be one of the most exciting years in the history of the crypto industry. Crypto activity and usage have reached all-time highs. Blockchain infrastructure has significantly improved, leading to a substantial decrease in transaction fees. Stablecoins have found their market fit. The intersection of crypto and artificial intelligence has become clearer. Bitcoin and Ethereum ETPs (exchange-traded products) have been approved. The legislative and regulatory environment now provides a positive development path for the industry. All of this lays the foundation for another exciting year.
As we think about the future of the crypto industry, here are five metrics we will closely watch to track the ongoing progress of the industry. (For other metrics, you can also check our Crypto Industry Status Index published in 2023, which tracks broader industry innovation and adoption trends.)
1. Monthly Active Wallet Users
To unlock the next wave of crypto users, we need to move towards a user experience (UX) comparable to that of Web2 applications. Mobile wallets will play a key role here: there are currently hundreds of millions of "passive" cryptocurrency holders (i.e., those who own cryptocurrency but do not transact on-chain regularly) who have the potential to convert into active crypto users. To achieve this, developers need to continue building new consumer applications, while consumers need wallets to participate.
Last month, the number of mobile wallet users reached an all-time high, breaking the 35 million mark for the first time. This growth is thanks to the rise of well-known brands like Coinbase Wallet, MetaMask, and Trust Wallet, as well as emerging players like Phantom and World App.
Consumer wallets present one of the biggest challenges for developers—finding the right balance between security, privacy, and usability is no easy task. However, blockchain infrastructure today can support hundreds of millions or even billions of on-chain transactions, making it the best time to build the next generation of mobile wallets. We will closely monitor these developments in 2025.
View monthly active wallet user data.
2. Adjusted Stablecoin Trading Volume
As infrastructure has developed, significantly lowering transaction costs, stablecoin activity increased in 2024. Notably, stablecoins are used not only for cryptocurrency trading but also for cross-border payments and remittances; purchasing goods and services; and as a store of value, especially in countries with severe inflation. Stablecoins have become the cheapest way to send dollars, and we expect businesses to increasingly accept stablecoins as a payment method.
With these drivers, the trend of on-chain value settlement growth should continue into 2025. While we can easily measure trading volume through on-chain data, isolating genuine organic stablecoin usage can be challenging. Transactions can be initiated manually by end users or programmatically by bots, and some on-chain transactions do not resemble traditional settlement methods.
Fortunately, Visa has created a clear and simple way to showcase the use of stablecoins, while adjusting for non-organic activity from bots and other artificial inflationary behaviors.
If the adoption of stablecoins—one of the most explicit use cases for cryptocurrencies—widely occurs in 2025, then this metric will be a focus of our attention.
Track Stablecoin Trading Volume Data
3. ETP Net Inflows (Bitcoin and Ethereum)
The U.S. Securities and Exchange Commission (SEC) approved exchange-traded products (ETPs) for Bitcoin and Ethereum last year; more FAQs on the subject can be found here. This is an important milestone that makes cryptocurrencies more accessible to both retail and institutional investors. However, activating distributors—such as Goldman Sachs, JPMorgan, and Merrill Lynch—that can introduce these products into retail investors' portfolios will take time.
One way to measure ETP activity is through "net inflows," which represents the amount of BTC or ETH entering or exiting the ETP. (Excluding existing products like Grayscale Bitcoin and Ethereum Trust, which are ultimately converted to ETPs.) So far, Bitcoin's net inflow is 515,000 BTC (bringing $110 billion in on-chain holdings), and Ethereum's net inflow is 611,000 ETH (bringing $13 billion in on-chain holdings).
As more institutional investors seek exposure to crypto assets, this should lead to an increase in ETP net inflows. By tracking on-chain deposits and withdrawals from addresses identified as ETP custodians, we can monitor this data in real-time.
Track ETP net inflows here and track here.
4. DEX vs CEX Spot Trading Volume
As more people enter the on-chain space, we expect the usage of decentralized exchanges (DEXs) relative to centralized exchanges (CEXs) to increase in crypto trading. After all, one of the core premises of cryptocurrency is decentralized finance (DeFi). As the DeFi ecosystem has developed, the share of spot trading on DEXs has steadily increased, reaching about 11% in recent years. We expect this trend to continue in 2025.
Recently, DEX trading volume reached an all-time high—driven mainly by a substantial increase in trading volume on high-throughput chains like Coinbase's Base and Solana, along with the influx of new users.
With more new consumer applications coming online, decentralized exchanges may continue to grow their relevance, further driving the development of DEXs.
As we monitor the balance shift between decentralized, crypto-native activity and centralized crypto trading, this will be an important indicator.
Track the spot trading volume of DEXs vs CEXs here.
5. Total Transaction Fees (Block Space Demand)
Total transaction fees in USD reflect the overall demand for block space on a chain—that is, its actual economic value.
However, this metric has many nuances, as most projects explicitly state that they want to lower costs for users. Therefore, it is also essential to consider unit transaction costs—the cost per unit of blockchain resources. Ideally, overall demand (total transaction fees) should increase while gas fees (cost per unit of resource) remain low.
In November 2024, the transaction fees charged by Solana surpassed those of Ethereum for the first time (see below). Notably, this milestone was achieved even though Solana's unit transaction costs are significantly lower; the cost to send USDC on Ethereum is around $5, while on Solana it is less than 1 cent. This is an important milestone, and we will continue to monitor it.
Many ecosystems and their associated fee markets are maturing, making now a good time to start measuring the economic value facilitated by various blockchains. In the long term, demand for block space—measured by the total dollar value of fees paid—may be the most important metric to track the progress of the crypto industry. Why? It reflects the extent of user participation in valuable economic activities and the willingness of users to pay for those activities.
Track blockchain space demand and transaction fees here.
