Why 2025 could be crypto's biggest year yet

Panteral Capital founder Dan Morehead recently discussed the development of the cryptocurrency industry in 2025 with Real Vision co-founder Raoul Pal.

Dan and Raoul have known each other for 25 years and both have been investing in cryptocurrencies for more than a decade. Both acknowledge that 2025 could be a big year for the crypto industry.

The main contents of the conversation are as follows:

Macro Trends and Fed Policy Impacting Cryptocurrency

The conversation began by discussing the impact of the Fed’s policies on the economy and the cryptocurrency market. Dan believes that the Fed’s long-term low interest rate strategy has led to a significant inflationary impulse, resulting in limited tools for the United States to deal with its growing debt and fiscal challenges.

Dan: “The Fed made a huge mistake by keeping interest rates too low for too long. It’s much harder to correct that mistake than to correct it bit by bit…

“ The U.S. is now paying more in interest than it is spending on defense, which is a crazy situation. Most countries, when faced with that, would inflate their way out of the situation. ”

The growing debt crisis and the role of blockchain

As the global debt burden continues to grow, Dan and Raoul highlighted the potential of blockchain as an alternative to the traditional financial system. They discussed Bitcoin as a “stateless currency” that could serve as a hedge against currency mismanagement.

Raoul: “ Most people don’t realize it, but governments around the world are devaluing their currencies by about 8% every year. Bitcoin is a hedge against this devaluation .”

Dan: “We are seeing the separation of money and state. Bitcoin is a currency that can do everything other currencies can do, but it is not controlled by any one country.”

Bitcoin’s Growth and Institutional Adoption

The discussion highlighted growing institutional interest in Bitcoin due to regulatory developments and ETF approvals. Dan predicts that institutional allocations to Bitcoin and other crypto assets will increase in the coming years.

Dan: “BlackRock and Fidelity’s launch of a Bitcoin ETF breaks down the last barrier for institutional investors. Now, no one can say ‘we can’t invest in Bitcoin for compliance reasons’.”

Raoul: “We see Bitcoin emerging as a strategic reserve asset, not only for individuals but potentially for nations as well.”

Cryptocurrency adoption trends in the Middle East and around the world

The panel discussed the growing interest in blockchain in the Middle East as sovereign wealth funds begin to explore cryptocurrencies as part of their diversification strategies.

Dan: “The GCC countries realize that blockchain is suitable for their needs because they are a frontier market with a lot of capital to deploy…

“ Once the U.S. establishes a strategic reserve of Bitcoin, we will see other countries, especially those seeking to hedge against U.S. dominance, follow suit. ”

Tokenization and integration with real-world assets

The tokenization of assets such as real estate, treasuries and commodities was highlighted as one of the most exciting areas of blockchain innovation, with Dan noting that there are already projects tokenizing billions of dollars in real-world assets.

Dan: “Figure is powering $10 billion in mortgages on the blockchain. It’s not just talk — it’s happening…

“Ondo is tokenizing the national debt, allowing anyone with a smartphone to borrow money from the US government. This is revolutionary.”

Cryptocurrency is the fastest growing economic frontier

Both speakers agreed that blockchain represents the fastest growing economy in history, with the potential to expand from $3 trillion to $100 trillion in the next decade.

Dan: “Blockchain is a new economy. It’s like the birth of an asset class, just like emerging markets and commodities were in the 1990s.”

Raoul: “We’re only 3% done. When people ask me if it’s too late, I tell them, ‘No, it’s just the beginning.’”

AI and Cryptocurrency Fusion

The intersection of AI and cryptocurrency is seen as a transformative area, with blockchain enabling decentralized governance, ownership, and incentivized data sharing for AI applications.

Dan: “AI agents need a native financial system, and blockchain is it. Decentralization makes AI more accountable and accessible…

“Blockchain incentivizes people to share private or valuable data for AI models, creating an economic value layer for AI.”

Generational change and the sociopolitical impact of cryptocurrency

Dan noted that the demographics of cryptocurrency adoption are changing, with younger generations driving the industry’s growth and even having a significant impact on the outcome of the U.S. election.

Dan: “Young people love crypto. It’s a way for them to build wealth in a system that keeps them from affording housing and other opportunities…

“ Cryptocurrency is no longer a partisan issue. 50 million Americans own cryptocurrencies, and being against it is political suicide. ”

Looking ahead

Dan and Raoul concluded by reflecting on the opportunities in the cryptocurrency market, stressing that despite the growth achieved so far, the journey has only just begun.

Raoul: “This is the biggest macro opportunity ever. Our job is not to screw it up.”

Dan: “Blockchain is still in phase one. Most institutions have zero deployment, but that’s changing rapidly.”