Summary of highlights of the crypto market outlook in 2025

I’ve been following research published by some of the smartest Web3 teams. Their articles provide food for thought, present different perspectives, and help you become more confident in the ideas you agree with.

Research articles contain professional opinions that can help you better understand different people’s views on the Web3 field. Now let’s take a look at the Delphi team’s summary of “Crypto Market Outlook 2025”.

1. Long Live Bitcoin

Not long ago, many people thought that a $100,000 Bitcoin price was just a pipe dream.

Now, that sentiment has changed dramatically. Bitcoin’s market cap is a staggering $2 trillion. If Bitcoin were a public company, it would be the sixth most valuable company in the world .

Bitcoin has already attracted a tremendous amount of attention, but it still has considerable room to grow.

• The market value of Bitcoin is only 11% of the total market value of the seven major US technology giants (Apple, Nvidia, Microsoft, Amazon, Google, META, and Tesla).

• It accounts for less than 3% of the total market value of U.S. stocks and about 1.5% of the total global stock market value.

• Its entire market value accounts for only 5% of the total outstanding US public debt and less than 0.7% of the total global debt (public + private).

• The size of U.S. money market funds is three times the market value of Bitcoin.

• Bitcoin’s market capitalization accounts for only about 15% of total global foreign exchange reserve assets. Hypothetically, if global central banks reallocated 5% of their respective gold reserves to Bitcoin, it would increase purchasing power by more than $150 billion—three times the total net inflows into IBIT this year.

• Household net worth has reached an all-time high of more than $160 trillion, more than $40 trillion higher than the pre-pandemic peak. This growth, driven primarily by rising home prices and a booming stock market, is 80 times higher than Bitcoin’s current market value.

In a world where the Federal Reserve and other central banks are causing their currencies to depreciate by 5-7% per year, investors need to target annual returns of 10-15% to compensate for the resulting loss of future purchasing power.

So you understand:

• At a 5% annual depreciation rate , the real value of the currency will drop by half in 14 years .

• At a depreciation rate of 7% per year, the real value of the currency will drop by half in 10 years .

This is why Bitcoin and other high-growth industries are gaining so much attention and traction.

2. Disillusionment with altcoins

While Bitcoin has hit new all-time highs time and again this year, 2024 has not been a very successful year for most altcoins.

• ETH has not reached its all-time high.

• SOL has hit a new all-time high again, but it is only a few dollars higher than its previous high, which is somewhat insignificant compared to the growth in market capitalization and network activity.

• ARB started the year strong but began to underperform towards the end of the year.

The list goes on. Just look at the data for 90% of the altcoins in your portfolio.

What is the specific reason?

The first reason is Bitcoin’s dominance . Bitcoin has had a remarkable year, fueled by ETF flows and Trump’s support, leading to a year-to-date price increase of more than 130% and boosting its dominance to a three-year high.

The second reason is market fragmentation.

This year’s market fragmentation is a new phenomenon in the crypto market. Previous market cycles tended to trade in sync. When BTC rose 1%, ETH would usually rise 2% and altcoins would rise 3%, with a predictable pattern. However, this cycle is different.

There are a small number of cryptocurrencies that are doing very well, but there are also large swathes of red.

The rising Bitcoin wave did not benefit everyone, and the classic “Path to Altseason” that many expected did not materialize.

Last but not least, Memecoins (and more recently AI Agents).

Cryptocurrency has always vacillated between being a pure Ponzi scheme and a technology that promises to change the world. In 2024, the former dominates the discourse.

The memecoin supercycle amplified the notion that cryptocurrencies were just a giant Ponzi scheme. People began to question whether fundamentals really mattered and whether cryptocurrencies were just “casinos on Mars” — and these concerns were legitimate.

I would like to say more in this regard.

When memecoins are labeled as the top performers of the year, only the largest memecoins are taken into account - those that have created significant market caps and built communities. People often overlook the fact that 95% of memecoins issued fail to maintain their value, but people "want to believe".

With this belief, many people who previously invested in altcoins switched to buy meme coins - some succeeded, but most failed. As a result, capital inflows were mainly distributed between Bitcoin (institutional capital) and meme coins (high risk), pushing most altcoins aside.

Delphi believes that 2025 will usher in a shift towards "world-changing" technologies .

Personally, I’m not too optimistic. In 2024, there are many KOLs who focus mainly on Memecoins. For example, if I create a Telegram folder with some really valuable channels, it’s very difficult to find a channel that is not centered around “ape calls”. This is the attention game, and widely discussed narratives can seriously affect market trends.

3. What’s next?

(1) Stablecoin growth and credit expansion

A major obstacle facing the market is the oversupply of tokens. The market is facing a large number of new assets from private investment and public token issuance. For example, more than 4 million tokens were issued on Solana's pump.fun in 2024 alone. At the same time, the total cryptocurrency market capitalization has only increased by 3 times since the last cycle, compared with an 18-fold increase in 2017 and a 10-fold increase in 2020.

The missing ingredients—stablecoin growth and credit expansion—are starting to reappear. Lower interest rates and friendlier regulation are expected to spur speculative behavior and address these imbalances. As stablecoins regain traction, their trading and collateral-based role will be critical to market recovery.

(2) Institutional capital inflows

Until last year, institutional capital was very hesitant to participate in cryptocurrencies due to regulatory uncertainty. However, this situation began to change with the SEC’s reluctant approval of a spot Bitcoin ETF, paving the way for future institutional investment.

These institutional investors will look for investment opportunities that they are familiar with. While some investors may dabble in Meme coins, they are more likely to be more interested in assets in areas such as ETH/SOL, DeFi, or infrastructure.

Delphi expects the coming year to resemble the “ all-up ” phenomenon of previous cycles. This time, projects based on fundamental principles or core goals will regain attention. These may include assets such as OG DeFi, which have a good historical performance and are battle-tested. They may also be infrastructure assets, similar to the L1 transactions we observed before. Others may include RWAs (real world assets) or emerging fields such as AI or DePIN.

Not every cryptocurrency will rise by triple digits like before, and meme coins are here to stay. This could signal a new beginning and a broad crypto rally.

Note: Generally speaking, most institutional traders rely heavily on options for hedging. Therefore, if there is a “pump and dump”, the assets most likely to attract investor interest will be those with options, primarily tradeable on Deribit or Aevo.

(3) Solana Dominance

Solana demonstrates the resilience of the blockchain ecosystem. After experiencing a 96% plunge during the FTX debacle, Solana staged a stunning rebound in 2024.

Key highlights include:

• Developer Momentum: Solana’s hackathons and airdrops (such as the Jito airdrop) have reignited developer and user engagement, creating a virtuous cycle of innovation and adoption.

• Market Dominance: From meme coins to AI applications, Solana dominates trends in 2024. Notably, its Real Economic Value (REV) — a measure of transaction fees and MEV — exceeds Ethereum’s by more than 200%.

• Future Outlook: Solana is expected to challenge Ethereum's dominance in terms of scalability and user experience. Its seamless user experience and centralized ecosystem provide significant advantages over decentralized L2 solutions.

4. Final Thoughts

For many, the current market situation may be reminiscent of 2017-2018, when Bitcoin peaked at $20,000 before the New Year and began to fall shortly after 2018 arrived. However, in my opinion, it is irrelevant to compare the crypto market in 2018 to the market in 2025. These are two completely different environments.

It’s important to realize that the broad crypto market extends far beyond the timeline scope of CT and X. People outside of these platforms view the market very differently.

By 2025, I expect the crypto market to be split into two main verticals:

• Web3 Natives: Traders who are deeply embedded in the crypto market. They have a nuanced understanding of Bitcoin’s unique characteristics and are willing to engage in high-risk transactions, including meme coins, AI agents, and pre-sales — elements that evoke the Wild West.

• Regular investors: Institutional and retail investors often have different approaches to risk management and often stick to more basic investing and trading strategies — viewing cryptocurrencies as an alternative to the stock market.

Which vertical will be marginalized? Those early stage DeFi, RWA and DePIN protocols that cannot ensure leadership in their niche or at least on-chain. This is just my opinion.