2024 Crypto Market Review and 2025 Outlook

2024 is an important year in the history of cryptocurrency. With the two core narratives surrounding ETFs and the US elections, Bitcoin leads the industry to breakthroughs, with mainstream institutions and governments entering one after another, significantly enhancing the industry's recognition. The regulatory environment is also becoming clearer and more lenient, with mainstream integration, path differentiation, and regulatory evolution becoming the main themes of this year.

2024 Year in Review

Bitcoin is undoubtedly the core of this year. The approval of ETFs and national reserves have propelled Bitcoin to break through $100,000, marking its official transcendence beyond the crypto market, becoming a globally recognized anti-inflation asset. The Bitcoin ecosystem has also expanded; new applications such as inscriptions and runes have experienced significant fluctuations, but a diverse ecosystem has begun to take shape. The total locked value of Bitcoin DeFi has grown from $300 million at the beginning of the year to $6.755 billion, an increase of over 20 times for the year.

Ethereum has performed poorly this year, with value capture and activity declining, and its narrative power is not as strong as before. Although the call for a DeFi revival is loud, actual investment is insufficient except for re-staking. The emergence of Hyperliquid at the end of the year brings new hope to DeFi. Layer 2 is developing rapidly, continuously eating into the mainnet's share, raising questions about Ethereum's mechanism in the market.

Solana has risen strongly this year, with its TVL market share increasing from zero to 6.9%, making it the second largest public chain after Ethereum. The price of SOL has risen from $6 two years ago to $200, increasing over 100% just this year. With its low-cost and high-efficiency advantages, Solana has become the king of MEME and a hub for retail investors.

TON and SUI also have impressive performances. Telegram has ignited the chain games, leading to explosive growth for TON. SUI has attracted attention with its price increase, and the Move public chain is developing rapidly. In contrast, the public chain Aptos performed weaker during the same period but is more favored by traditional capital.

MEME has become a major driving force in the market this year, reflecting a shift in market dynamics. MEME has evolved from mere speculation to being a representative of cultural finance, with its trading volume consistently accounting for 6-7%. Pre-sale fundraising, celebrity tokens, and zoo battles are among the MEME projects that frequently become industry hotspots.

The infrastructure surrounding MEME continues to improve, and the fair launch platform Pump.fun has emerged as one of the most successful applications this year. However, the institutional trend of MEME is also becoming increasingly evident, making it more difficult for retail investors to profit.

Due to the influence of the US elections, the prediction market platform Polymarket has emerged, with trading volume skyrocketing to $2.5 billion, becoming a model of the integration of new media and gambling.

At the end of the year, AI has once again become a hot topic in the Web3 field. AI Agents have sparked a wave of small-scale application frenzy, considered the second phenomenon after DeFi. Although currently focused on surface applications, the deep integration of AI and blockchain is worth looking forward to.

PayFi has become an important bridge connecting traditional finance and Web3. Stablecoins and RWAs are typical representatives of this. Stablecoins occupy a place in the global payment and remittance market, with a circulation scale exceeding $210 billion. The market value of RWAs has expanded from less than $2 billion three years ago to $14 billion, covering multiple fields.

Despite the overall improvement, the encryption industry still faces stress tests. Innovative applications are hard to showcase, internal disputes are intensifying, and restructuring and mergers are ongoing. Weakening liquidity is creating path differentiation, forming a pattern where Bitcoin continues to siphon off other currencies. The altcoin market has been sluggish for more than half a year, only rebounding at the end of the year under institutional attention.

2025 Outlook

Looking ahead to 2025, with the new government coming to power and institutions entering the market, the encryption industry is expected to welcome new development opportunities.

In terms of price, multiple institutions predict that Bitcoin will reach $150,000 to $200,000, with some even giving a high estimate of $500,000. ETH is expected to be between $6,000 and $7,000, and Solana may rise to $500 to $750. The total market value of encryption is expected to reach $7.5 to $8 trillion.

In terms of the macro environment, it is expected that the US economy will achieve a soft landing, and encryption regulations will be relaxed. Multiple institutions are optimistic about the strategic reserve prospects of Bitcoin, believing that sovereign countries and listed companies will include Bitcoin in their reserves. The increase in ETF inflows will become a determining factor.

In specific sectors, stablecoins, tokenized assets, and AI are the most focused on. The settlement volume of stablecoins is expected to reach 300-450 billion USD. The value of tokenized securities could exceed 50 billion USD. The combination of AI and encryption will accelerate, and the market value of AI-related tokens may grow by more than 5 times.

In other aspects, the revival of DeFi, application chain and L2 integration, the popularization of ZK technology, the revenue growth of the DEPIN industry, and the return of NFTs are also viewed positively by institutions.

Overall, the crypto industry is expected to continue developing in terms of price, ecology, and applications in 2025. The price increase of mainstream coins seems to be a foregone conclusion, but the altcoin market will still show differentiation. While strong public chains dominate, the impact of new public chains cannot be ignored. The application layer will be the focus, with consumer-level applications becoming mainstream. Stablecoins, AI, and RWA, which are favored by institutions, are expected to accelerate their development.

For investors, it is still key to follow the cycle and conduct in-depth research when participating. A new market cycle is about to arrive, and it is equally important to seize opportunities and prevent risks.