The cryptocurrency markets saw major growth in 2024, with the total market capitalization of all crypto projects increasing by more than $1 trillion. Many experts believe that the markets will continue to rally into 2025 and that we could see Bitcoin and other cryptocurrencies reach new historical values.
But what could drive this growth? Well, there are actually several trends that seem like they could play an outsized role in future market movements.
In this article, we will examine these trends and look into potential catalysts that could shape the crypto industry next year.
1. Crypto-friendly regulatory developments
Following the election of Donald Trump as the next U.S. President on November 5th, the cryptocurrency markets exploded, led by Bitcoin’s reaching an all-time high of $89,800 during the post-election rally.
Investors are betting that the Trump presidency will be much more crypto-friendly than the Biden administration, and for good reason. Not only has Trump promised to replace the hawkish SEC chair Gary Gensler, who was notoriously anti-crypto, but he is also involved in a number of crypto projects directly – including Donald Trump trading cards, a NFT collection featuring the president-elect’s cartoonish images – and World Liberty Financial, a DeFi project led by him and his sons.
Trump promised to replace Gary Gensler, the SEC chair who had been notoriously anti-crypto during his tenure.
When speaking at the Bitcoin yearly conference in Nashville during his campaign, the former president pledged to make the U.S. a leading nation in cryptocurrency and proposed the creation of a strategic Bitcoin reserve. “If Bitcoin is going to the Moon — as we say — it’s going to the Moon, I want America to be the nation that leads the way,” he said.
2. Stablecoins will be a key adoption driver
Stablecoins are one of the most popular products for regular people who are looking to get involved in crypto. Not only are they essential for trading purposes, but they also allow easy transfer of funds across borders and are a perfect shelter against crypto volatility on the blockchain.
Over the course of this year, the total market cap of all stablecoins increased by nearly $50 billion, from $130 to $178 billion. USDT and USDC are the two dominant solutions in the space, accounting for nearly 87% of the entire sector.
As of November 2024, the total stablecoin market cap stands at $178 billion.
The proliferation of stablecoins could continue into 2025. Under Trump, the US regulations pertaining to stable assets could become clearer, paving the way for more banking and e-commerce integrations. Meanwhile, the regulatory environment in the EU (with the MiCA regulation) and the UK have become quite robust over the past couple of months, allowing for innovation and market expansion.
Another significant development in the sector will definitely be the launch of RLUSD, a stablecoin developed by the crypto payments company Ripple, which is probably best known for its role in developing the XRP coin.
3. Continued growth of meme coins
Meme coins have been on the rise throughout 2024, with some of the largest gainers in the meme coins sector increasing their value by hundreds of times. Some of the more notable examples include Gigachad (+160,000% YTD), Neiro (+70,500% YTD), and Popcat (+16,100% YTD. However, the so-called blue chip meme coins, like Dogecoin and Shiba Inu, have also impressed with 100%+ gains.
The rise of meme coins on Solana has been a major development in 2024. Thanks to low fees and fast transaction times, Solana has managed to capture a significant market share that was previously dominated by Ethereum. This has been reflected in the rise of trading volumes of Solana-based DEXes. In fact, Raydium, the largest DEX in the ecosystem, has managed to pull off higher daily trading volumes than Ethereum’s leading trading protocol, Uniswap, on a number of occasions.
Solana has become a serious challenger to Ethereum in terms of DEX volume.
It’s safe to assume that the trend of investors buying meme coins and driving their value purely on speculation will continue into 2025. The same thing is happening in the stock market after all, with stocks like DJT, GME, and AMC being the prime examples.
4. Cross-chain interoperability
Developments in blockchain interoperability are enabling seamless transactions across different blockchain networks. This reduces the complexity for users who wish to interact with multiple cryptocurrencies and decentralized applications (dApps).
At the moment, if a user wants to transfer value between two different chains, they have to use cumbersome interfaces where the opportunity for error is high and can lead to a loss of funds. It also deters the average Joe from engaging with DeFi and all that it has to offer.
In the long run, however, it’s easy to envision a future where users can interact with protocols across different blockchains, and things like swapping and bridging crypto are carried out completely under the hood. This will increase accessibility and help novice users interact with crypto more efficiently, which brings us to our last point.
5. Focus on user-friendliness
For cryptocurrency to truly take off and challenge traditional finance, it will have to become more user-friendly. It should also minimize the possibility of user error, where an inexperienced user can send their crypto to an unsupported chain and lose access to their funds permanently.
Binance Pay allows users to send crypto via email/phone to other Binance users, avoiding cumbersome blockchain addresses.
Also, overpaying for gas fees should become a thing of the past. Luckily, new wallet products are already adopting this approach. Features such as simplified onboarding processes, enhanced security measures, and integrated educational resources are making it easier for users to manage their digital assets.
Some products are also adopting the ability to send crypto using the recipient’s phone number as an identifier, similar to what many neobanks are doing. Products like Binance Pay, Coinbase Wallet, Nexo, Coincast, and some of the other best crypto wallets, aim to make cryptocurrency transactions more accessible by reducing reliance on complex wallet addresses, thereby minimizing errors and enhancing user experience.
The bottom line
With increasing regulatory clarity, the rise of stablecoins, growth in the meme coin sector, advancements in cross-chain interoperability, and a stronger focus on user-friendly interfaces, 2025 has the potential to be a pivotal year for crypto.
It’s worth noting that we could have easily identified more trends, such as increased institutional investor interest (thanks to spot crypto ETFs in the US) or a relaxing monetary environment (due to predicted interest rate cuts), but the trends mentioned deserve to be at the forefront of. At least in our opinion.
If you want to explore more current trends, we suggest you check out how Trump’s win could help Bitcoin and why right now it might be a good idea to convert your BTC to ETH.
