Original title: (Delphi's "The Year Ahead for Markets 2025": Key Insights)
Author: Stacy Muur
Compiled by: Deep Tide TechFlow
Introduction
As the year-end approaches, various research and predictions are pouring in. @Delphi_Digital recently released the (2025 market outlook), delving into an analysis of the current market conditions and future trend forecasts, covering a range of topics including Bitcoin price trends, major trends, and risk factors.
Due to the length of the full text, comprehensive reading would take a significant amount of time. Deep Tide TechFlow has compiled an article summarizing the core viewpoints of Stacy Muur regarding the (2025 market outlook).
This article divides the Delphi Digital report into three main parts: the rise of Bitcoin, the mirage of altcoin season, and the trends for future development. Currently, Bitcoin's market cap has reached about $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 expresses her unique views on the 2025 crypto market, believing that the crypto market is evolving from the 'Wild West' to a more regulated alternative stock market. Web3 native users will be willing to take on high risks and participate in speculative trading, while newcomers will adopt robust risk management and focus on long-term value, with some narratives possibly being marginalized.
Main Text
The Rise of Bitcoin
Once upon a time, a Bitcoin price of $100,000 was considered a fantasy.
And now, this perspective has undergone a dramatic change. The current market capitalization of Bitcoin is approximately $2 trillion—remarkable. If Bitcoin were viewed as a publicly listed company, it would become the sixth most valuable company in the world.
Despite Bitcoin attracting wide attention, its growth potential remains significant:
The market cap of BTC accounts for only 11% of the total market cap of MAG7 (Apple, NVIDIA, Microsoft, Amazon, Alphabet, Meta, and Tesla).
It accounts for less than 3% of the total market capitalization of U.S. stocks and about 1.5% of the total market capitalization of global stocks.
Its market capitalization is only 5% of the total U.S. public debt and less than 0.7% of the total global (public + private) debt.
The total amount of funds in U.S. money market funds is three times the market value of Bitcoin.
The market value of Bitcoin is only about 15% of the total global foreign exchange reserve assets. Assuming global central banks invest 5% of their gold reserves into Bitcoin, this would bring Bitcoin more than $150 billion in purchasing power—equivalent to three times this year's net inflow of IBIT.
Currently, global household net worth has reached a historical high of over $160 trillion, exceeding the pre-pandemic peak by $40 trillion. This growth is mainly driven by rising house prices and a booming stock market. In comparison, this figure is 80 times the current market value of Bitcoin.
In a world where the Federal Reserve and other central banks promote a 5-7% annual depreciation of currency, investors need to pursue a 10-15% annual return rate to offset future purchasing power loss.
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 industries are receiving so much attention.
The mirage of altcoin season
Despite Bitcoin setting one historical high after another this year, 2024 is not friendly for most altcoins.
$ETH failed to break through historical highs.
$SOL reached new highs, but the increase was only a few dollars above previous peaks, 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-end approached.
There are many similar examples. Just look at the performance data of the 90% altcoins in your portfolio.
Why is this the case?
Firstly, Bitcoin's dominance is a key factor. BTC has performed exceptionally strong this year, driven by ETF inflows and factors related to Trump, with its price rising over 130% year-to-date and its dominance reaching the highest level in three years.
Secondly, there is the phenomenon of market divergence.
This year's market divergence 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 quite different.
Although a few assets have performed exceptionally well, more assets are in a state of loss. Bitcoin's rise has not led to a comprehensive increase in the prices of other assets, and the 'altcoin season' that many anticipated has not materialized.
Lastly, Meme coins and AI agents also play important roles.
The crypto market constantly oscillates between 'this is a Ponzi scheme' and 'this technology will change the world.' In 2024, the narrative of 'scam' dominated.
In the collective imagination of the public, the crypto market oscillates between 'a globally unified financial system of future technologies' and 'the greatest scam in human history,' occurring every two years.
Why does this narrative seem to alternate between two extremes and happen every two years?
The super cycle of Meme coins and market sentiment
The super cycle of Meme coins further reinforces the impression that the crypto market is a 'Ponzi scheme.' Many 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 note.
When Memes are called the best-performing assets of the year, people usually only focus on the 'mainstream Memes' (such as DOGE and SHIB) that already have significant market values and have 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 led many funds that previously invested in altcoins to shift towards Memecoins—few profited, but most did not succeed. As a result, capital inflows have primarily concentrated between Bitcoin (institutional funds) and Memecoins (high-risk investments), while most altcoins have been ignored.
Delphi believes that 2025 will be a year of technological-driven market transformation, and these technologies will 'change the world.'
But I am not so optimistic about this personally. In 2024, a large number of KOLs (key opinion leaders) focusing on Memecoins emerged. When I tried to create a folder on Telegram containing channels of 'truly valuable' information (you can find it here), I found that almost all channels were discussing 'ape calls' (i.e., high-risk short-term investment advice). This is the essence of the attention economy, and these narratives profoundly influence market trends.
What are the upcoming trends?
The growth of stablecoins and credit expansion
A major challenge facing the current market is the oversupply of tokens. Driven by private investments and public token issuance, a large number of new assets have flooded in. For instance, more than 4 million tokens were launched on Solana's pump.fun platform alone in 2024. However, in contrast, the total market capitalization of the crypto market has only grown three times compared to the previous cycle, while it grew 18 times and 10 times in 2017 and 2020, respectively.
Two key factors missing from the market—growth of stablecoins and credit expansion—are re-emerging. With falling interest rates and improved regulatory environments, speculative behavior is expected to re-emerge, alleviating the current market imbalance. The central role of stablecoins in trading and collateral will be crucial for the market's recovery.
Institutional capital inflows
Until last year, institutional investors were still cautious about crypto assets due to regulatory uncertainties. However, with the SEC's reluctant approval of a spot Bitcoin ETF, this situation began to change, paving the way for future institutional capital inflows.
Institutional investors usually tend to choose familiar investment areas. Although a few institutions may dabble in 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 experience a 'full rebound' similar to past cycles in the coming year. Unlike previous times, this market will focus more on fundamentally driven projects. For instance, OG DeFi projects (original decentralized finance projects) with records that have stood the test of the market may become focal points; infrastructure assets (like L1 protocols) may also regain prominence. Furthermore, RWA (real-world assets) or emerging fields (like AI and DePIN) may also become hotspots.
Of course, not all tokens will achieve triple-digit gains as in the past, but the existence of Memes will become part of the market. This may signal a new starting point, a broad crypto rebound driven by an overall market rise.
Note: Most institutional traders typically rely on options hedging strategies. Therefore, if a 'full rebound' occurs, the assets most likely to attract institutional interest will be those with options trading—currently mainly traded on Deribit and possibly Aevo platforms.
Arguments about Solana
@Solana has demonstrated the strong resilience of the blockchain ecosystem. After experiencing a 96% market cap drop due to the FTX collapse, Solana has seen a remarkable recovery in 2024.
Here are its key performance highlights:
Developer momentum: By hosting hackathons and distributing airdrops (like the Jito airdrop), Solana successfully rekindled developers' and users' interest. This increase in participation not only drives innovation but also creates a virtuous cycle where tech development and user adoption complement each other.
Market leadership: In the 2024 crypto market trends, Solana is leading from Memes to AI application fields. 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 expected to challenge Ethereum's dominance in terms of scalability and user experience. Compared to decentralized Layer-2 solutions, Solana provides a seamless user experience and a highly centralized ecosystem, giving it a significant advantage in competition.
Stacy's Final View
The current market conditions may remind one of 2017-2018 when Bitcoin reached a historic high of $20,000 on New Year's Eve, only to start declining in early 2018. However, I believe it is inappropriate to compare the crypto market of 2018 with that of 2025. The two are 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 on Crypto Twitter (CT) and X platforms. For those not active on these platforms, their understanding and perception of the market may be entirely different.
Looking ahead to 2025, I believe the crypto market will diverge into two main directions:
Web3 native users: This group is deeply involved in the crypto market, familiar with its unique operations, and willing to take on high risks, participating in speculative trades involving Memes, AI agents, and presale projects. These behaviors evoke memories of the early 'Wild West' days of the crypto market.
Ordinary investors: Including institutional and retail investors, who typically adopt more robust risk management approaches and tend to favor fundamentally driven investment strategies. They view the crypto market as an alternative to traditional stock markets, focusing on long-term value rather than short-term speculation.
So, which sectors might be marginalized? Early DeFi projects, RWA (real-world assets), and DePIN (decentralized physical infrastructure network) protocols that fail to establish a leading position in their fields or the blockchain ecosystem may gradually lose market attention. This is just my perspective.
PS: This article summarizes the core viewpoints from @Delphi_Digital's 2025 market outlook. If you want a comprehensive understanding of Delphi's detailed predictions for 2025 and beyond, I strongly recommend reading their original research report.
