27 December 2024

It’s not quite a fairy tale end to 2024 but we would take Bitcoin trading at $95,000 gleefully.

Last week, we reflected on how 2024 panned out (read here). This week, we will put our predictor hats on and gaze into 2025.

This is going to be exciting. Are you ready?

Top-3 stories of the week:

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The newsletter is put together by Giottus Crypto Platform. You can read all the previous issues of Cryptogram here.

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WEEKLY MACROS

• Total crypto market cap - $3.38 trillion - UP 1.8%    

• Bitcoin price - $96,815 - DOWN 0.4%

• The dollar index (DXY) - 108.16 - DOWN 0.2%

• Bitcoin Dominance - 58.11% -  DOWN 1.4%

• Crypto Fear and Greed Index - 74 - Market is in Greed

THE HOT TAKE

2025: Top 4 predictions for crypto

If 2024 was a good year, 2025 can be even better. The longer-term outlook for Bitcoin remains highly bullish. With macroeconomic trends, technical indicators, and on-chain metrics aligning, Bitcoin is entering one of its most pivotal and promising phases yet. We have identified 4 trends that will define crypto in 2025. And, of course, don’t rule out a $200,000 price range for Bitcoin!

Institutional capital will grow multi-fold

Institutional interest in crypto is growing, post the US SEC’s approval of spot Bitcoin ETFs paving the way for traditional investors to enter the space.

Ecosystems like Ethereum, Solana, DeFi, and infrastructure are likely to attract the most attention, as they align with institutional familiarity and risk preferences. If regulatory stances become friendlier, we could see ETFs for other top altcoins like XRP and Solana.

Analysts predict a broad market rally, with a focus on projects that have strong fundamentals, such as established DeFi protocols and emerging areas like AI or Real-World Assets (RWAs).

Institutions prefer assets with proven use cases, robust ecosystems, and manageable risk. With tools like options for hedging, they can better navigate the market. This sets the stage for a rally driven by quality projects.

Retail adoption will increase across the world

Across the world, mainstream acceptance of crypto is growing as digital assets become easier to access and safer to use. A survey conducted by EY-Parthenon revealed that 54% institutional and 64% of retail investors plan to increase their crypto allocations.

Meanwhile, enhanced regulations provide a more secure environment, addressing fears of fraud or misuse. Together, these changes are creating a more inclusive and trustworthy crypto ecosystem, encouraging broader retail participation.

Memecoins will continue to thrive in 2025

You love reading this, don’t you?

We anticipate memecoins to keep growing in popularity through 2025.  This growth will be fuelled by improvements in blockchain technology that make transactions faster and cheaper, especially on chains like Solana and Base.  Additionally, user-friendly apps will simplify memecoin trading, making it easier for everyday people to get involved. Keep an eye out for memecoins that has AI agents as use cases, as this will likely become one of the top narrative in 2025.

Why do we feel so?

• Memecoins are like gambling: They are risky but can bring big rewards, which makes them exciting

• Memecoins could replace other types of gambling: Globally, users might start buying memecoins instead of betting on sports or other things

• Memecoins will find new uses: People will find new and creative ways to use memecoins in the future

Bitcoin staking will become more popular

Here is an offbeat idea.

The emergence of Bitcoin staking protocols like Babylon marks a significant evolution in Bitcoin's utility. By leveraging Bitcoin's robust security model, these protocols enable BTC holders to participate in securing other Proof-of-Stake networks while earning rewards. This novel approach allows for the "restaking" of Bitcoin's inherent security, effectively transforming it into a foundational pillar for a burgeoning interoperable blockchain ecosystem.

Here's why this shift is poised to gain traction in 2025

• Proven demand: Babylon's rapid accumulation of staked Bitcoin demonstrates the strong appetite for decentralized and secure methods of generating yield on BTC holdings

• Yield generation on native BTC: Bitcoin staking provides an opportunity for long-term holders to generate yield on their BTC holdings without compromising on self-custody

• Enhanced network security: By incentivizing the utilization of Bitcoin's hashrate for cross-chain security, staking protocols contribute to the overall robustness of the broader blockchain landscape

 What does it all mean for you?

As an investor, we have to identify trends and invest in them early. Crypto as an asset class is one such trend that we must bet on seriously. Depending on your appetite, firm up your positions by the first week of January and enjoy the ride in 2025.

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If you have any questions or feedback for us, write to us at [email protected]. You can check out the previous issues here.

Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Please do your own research before investing and seek independent legal/financial advice if you are unsure about the investments.