2024 crypto market review and 2025 outlook

2024 is a key year in the history of cryptocurrency. Around the two major themes of ETFs and the US elections, Bitcoin has led the industry to breakthroughs. Mainstream institutions and governments have entered the market one after another, significantly increasing the recognition of crypto assets. The regulatory environment has also become clearer and more lenient with the new government taking office. Mainstream integration, differentiated development, and regulatory evolution have become the main themes of the industry this year.

2024 Year in Review

Bitcoin reaches the top

Bitcoin is undoubtedly the core focus this year. The approval of ETFs and the backing from national reserves have propelled Bitcoin to break through $100,000, officially establishing its position as a global anti-inflation asset. The Bitcoin ecosystem has also expanded; although different projects perform variably, a diversified ecosystem has begun to take shape. The total locked value in Bitcoin DeFi surged from $300 million at the beginning of the year to $6.755 billion, growing more than 20 times over the year. The broader BTCFI has performed even more impressively, with Bitcoin ETF shares soaring, and the holding strategies of listed companies like MicroStrategy being eagerly emulated.

Ethereum faces challenges

In contrast, Ethereum has had a tough year. Asset performance has been poor, with declines in value capture and user activity, and its narrative strength has diminished. Although the call for a DeFi revival is loud, actual investment is noticeably lacking. The rise of Hyperliquid at the end of the year brings a glimmer of hope for DeFi. On the other hand, the competition within Ethereum's Layer 2 networks has intensified, eating into the mainnet's share and raising questions about Ethereum's mechanisms.

Solana rises strongly

Solana's performance contrasts sharply with Ethereum. Its TVL market share surged from a negligible amount at the beginning of the year to 6.9% by the end of the year, becoming the second largest public chain after Ethereum. The price of SOL has created a growth miracle, skyrocketing from 6 dollars two years ago to 200 dollars today. With its advantages of low cost and high efficiency, Solana has become a hub for the MEME ecosystem and a primary gathering place for retail investors this year.

MEME casino is receiving a lot of attention

MEME has become the main driving force in this year's market. Its rise signifies a shift in the market landscape, with VC tokens falling out of favor and excess liquidity moving towards sectors that are fairer and more profitable. The connotation of MEME is also continuously expanding, evolving from mere speculation to a representation of cultural finance. Although its market capitalization is not high, its trading volume continues to hold a significant share. The infrastructure surrounding MEME is also being continuously improved, with fair launch platforms like Pump.fun emerging.

AI and encryption fusion becomes a new hotspot

At the end of the year, AI once again became the focus of the market. AI MEME projects represented by Truth Terminal have sparked a wave of enthusiasm. Currently, the deep integration of AI and blockchain is still relatively rare, but institutions are generally optimistic about the emerging track of AI Agents.

Stablecoins and RWA are rapidly developing

As a bridge connecting traditional finance and the crypto market, stablecoins and RWA have seen rapid development this year. Stablecoins have established a foothold in the global payment and remittance market, with a current circulation exceeding 210 billion USD. The RWA market has also expanded from less than 2 billion USD three years ago to 14 billion USD this year.

2025 Outlook

According to predictions from multiple organizations, the crypto market is expected to continue improving in 2025:

• The price of Bitcoin is expected to reach 150,000 to 200,000 USD, with some institutions even predicting it may surpass 500,000 USD.
• ETH is expected to reach 6000-7000 dollars, SOL may rise to 500-750 dollars.
• The total market capitalization of encryption is expected to exceed 7.5-8 trillion USD.

Institutions generally have a positive outlook on the three major areas of stablecoins, RWA, and AI:

• The settlement volume of stablecoins is expected to reach 300-450 billion US dollars.
• The value of RWA tokenized securities could exceed 50 billion dollars.
• The combination of AI and encryption will accelerate, especially in the field of AI Agents.

In addition, directions such as DeFi revival, ZK technology applications, and DEPIN are also attracting institutional attention.

Investor Strategies

Looking ahead to 2025, investors may focus on the following directions:

1. Mainstream cryptocurrencies are expected to continue rising, especially during the favorable policy period in Q1.
2. Compliance-focused altcoins are more likely to attract funding.
3. The competition between new and old public chains will intensify.
4. Consumer-grade applications are a key focus for the future, and application chains and account abstraction are worth paying attention to.
5. There are still opportunities in the DeFi track, projects like Hyperliquid and Ethena are worth paying attention to.
6. The speculation craze around MEME may slow down, but there is still room for development in the infrastructure surrounding MEME.
7. The sectors of stablecoins, AI, RWA, DePin, and other areas of institutional interest are expected to accelerate development.
8. On-chain liquidity tools and protocols may be favored.

A new market cycle is about to begin, and investors need to stay sharp to discover and seize new investment opportunities.