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It has been an extraordinary year for cryptocurrency, defined by bitcoin’s meteoric ascent. The world’s first crypto soared from under $40,000 in January, stabilized around $60,000 throughout the summer and then surged above $100,000 this fall.
Of course, the real turning point came with the US presidential election in November, an event that reshaped not only the political map, but also the monetary landscape.
Post-election enthusiasm, through pro-crypto policies and regulatory clarity, propelled Bitcoin to a market capitalization of around $1. 96 trillion.
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This is a remarkable achievement for an asset that only came to life shortly after Satoshi Nakamoto published the prominent whitepaper in October 2008.
One thing is clear: The crypto industry is evolving at a blistering pace. Momentum is obvious. But uncertainties remain.
Looking ahead to 2025, the big question is, what’s next for bitcoin and the broader cryptocurrency ecosystem? Will bitcoin’s rally continue? Will altcoins rise to challenge its dominance?
Let’s take a look at some of the key trends that will impact the crypto landscape in 2025.
Multiple secular forces are driving bitcoin and the broader crypto market right now.
First of all, bitcoin is popular in terms of trust, logo, and liquidity. Federal Reserve Chair Jerome Powell recently emphasized this point, calling Bitcoin “just like gold, it’s virtual, it’s digital. “
This comparison speaks volumes about bitcoin’s growing legitimacy in the financial world.
Another transformative progression is the arrival of spot Bitcoin ETFs. These exchange-traded budgets have gained traction since their appearance in early 2024, exceeding expectations by raising more than $60 billion in nine months.
According to Calamos Investments Senior Vice President and Head of ETFs Matt Kaufman, “Spot bitcoin ETFs from iShares and Fidelity have been the fastest-growing new product launches in history. This reflects the immense pent-up demand investors have for this asset class.”
Another key detail that fuels bitcoin is its constant supply: the total number of BTC is limited in the original source code to 21 million. This built-in scarcity reinforces value.
“A real-time supply shock is unfolding as bitcoin’s fixed supply meets surging demand,” notes Anthony Rousseau, head of brokerage solutions product management at TradeStation. “Many holders also remain unwilling to sell at current levels.”
However, investors should be cautious. Bitcoin is a very volatile asset.
“People are chasing gains like it’s 2021 all over again,” says David Materazzi, CEO of Galileo FX. “Bitcoin, meme stocks, you name it. Everyone wants in on the action. It’s fun, I’ll give it that. But speculation works until it doesn’t.”
Ethereum (ETH) is the second-largest cryptocurrency by market capitalization, just behind bitcoin.
What makes Ethereum attractive is not just its stature. It is also distinguished by its role as a platform for the creation of decentralized programs (dApps), in spaces such as monetary services.
At its core is Ether, Ethereum’s local token, which serves as payment for transactions on the platform.
“The institutional allocation disparity between Bitcoin and Ethereum is one of the most overlooked opportunities in the market today,” notes Jesper Johansen, CEO and founder of Northstake. “When we look at the numbers — 6% of Bitcoin in ETFs compared to just 1. 9% for Ethereum — we see a huge hole leading to a correction. “
“Institutional investors are realizing that Ethereum is not just another virtual asset,” Johansen observes. “It is a return-generating instrument. In 2025, we will begin to see parity between ETH and BTC holdings. “
Johansen sees staking as a primary driving force for Ethereum’s upside potential. Staking allows investors to earn rewards or interest on their cryptocurrency holdings.
According to Johansen, the potential regulatory approval of staking-focused U.S. ETFs could significantly boost ethereum’s appeal.
“What makes gambling so attractive,” he explains, “is its ability to generate higher returns than classic savings accounts or steady-income bonds. “
The meteoric rise of crypto stocks has been one of the most electrifying stories on Wall Street in 2024.
Take Coinbase Global (COIN), whose stock has nearly doubled. And MicroStrategy (MSTR) is showing a staggering 500% increase year to date.
Still, there are few pure-play crypto stocks available to trade on traditional exchanges. But that could change in 2025 with a more welcoming initial public offering (IPO) environment.
President-elect Donald Trump’s choice of Paul Atkins to lead the Securities and Exchange Commission (SEC) should provide a big boost for crypto IPOs.
Atkins is a proponent of cryptocurrencies and is expected to pave the way for smoother regulatory approval of new filings.
So, what are the hottest upcoming IPOs to watch for?
Circle Internet Financial, the second-largest issuer of stablecoins, is a strong contender. Stablecoins are cryptocurrencies pegged to assets like the US dollar.
And Circle has already captured the market’s attention. In April 2022, the company raised $400 million, with the backing of heavyweights such as BlackRock and Fidelity Management and Research.
Kraken, a cryptocurrency trading platform with a visitor base of over 10 million, is a prominent asset. With projected revenues of at least $1 billion by 2024, it’s a company poised to make waves in the public markets.
Tom Taulli has been developing software since the 1980s when he was in high school. He sold his applications to a variety of publications. In college, he started his first company, which focused on the development of e-learning systems. He would go on to create other companies as well, including Hypermart.net that was sold to InfoSpace in 1996. Along the way, Tom has written columns for online publications such as Bloomberg, Forbes, Barron’s and Kiplinger. He has also written a variety of books, including Artificial Intelligence Basics: A Non-Technical Introduction. He can be reached on Twitter at @ttaulli.