Blockchain had an eventful 2024. It started with the launch of Bitcoin ETFs, followed by Ether receiving its funds and subsequently attracting a lot of institutional money into the industry. As the year progressed and the world’s political attention turned to the US election, cryptocurrency came to the fore.
Exciting and innovative new products have grabbed a lot of attention, such as the impending launch of the layer-2 meme coin Pepe Unchained. There have also been controversies, including Binance CEO Changpeng Zhao’s sentence of four months in prison on money laundering charges. 2025 has a long way to go to top blockchain’s 2024.
Broadening Mainstream Adoption
Mainstream adoption has picked up steam with ETFs and the use of blockchain in traditional banking. Companies offer increasingly enhanced ways for individuals and other businesses to interact with the blockchain. SEO company, Golden Metrics, for example, specializes in offering SEO and PR-related services to companies in the web 3.0 space. (source: https://goldenmetrics.com/)
With the likely adoption of Bitcoin as a US strategic reserve, enhanced regulatory approval for crypto, and the continued investigation of Central Bank Digital Currencies, mainstream adoption will continue at pace in 2025 as companies and individuals offer new and innovative products.
Asset Tokenization
Asset tokenization means assigning blockchain tokens to real-world assets. It effectively means that any product, even non-digital items, can be put on the blockchain. This enables the tracking and monitoring of assets, and it can help fight fraud and theft while also enabling greater data manipulation and use of the products.
Virtually anything can be tokenized, with current examples of tokenized goods including real estate, fine art, whiskey, and even precious metals. This tokenization will continue in 2025 as companies and investors look for ways to add more items onto the blockchain.
The Rise Of Stablecoins
Volatility is the biggest concern for most novice crypto investors and companies that want to get involved in blockchain development. Most layer 1 and layer 2 blockchains require the acquisition and use of cryptocurrency. The volatility levels seen in the market mean that even holding coins like Bitcoin for a day or two can lead to a sizeable shift in value.
Stablecoins offer a solution. They are pegged to the value of real-world assets, typically local currencies like the US Dollar or the British Pound. Some of the most popular stablecoins include:
- USD Tether (USDT)
- USDC (USDC)
- Ethena USDe (USDe)
- Dai (Dai)
- First Digital USD (FDUSD)
Because the values of these coins are tied to currencies like the Dollar, their prices don’t suffer the same volatility. This has seen them become the most likely cryptocurrencies to enjoy improved regulation.
Their benefits will see governments and central banks continue to investigate these digital assets.
Continued Exploration Of CBDCs
However, while central banks are investigating and researching stablecoins, they arguably have more interest in establishing their own digital currencies, such as Central Bank Digital Currencies (CBDCs).
These are digital equivalents of local currencies. Strictly speaking, they aren’t cryptocurrencies because they are established and governed by central bodies. But they do share many similarities with cryptos. Central banks can see the benefits, with some, including the Bank of England, openly investigating the potential they have to offer. This will continue throughout 2025, and we may see the launch of the first major CBDC in the next 12 months.
Regulatory Changes
Blockchain is a disruptive technology. With the opportunity to change business and even politics comes risks to users. We’ve seen exchanges collapse, including the recent failure of FTX, while pump-and-dump or rug-pull schemes like the $HAWK coin are, unfortunately, still prevalent.
Because of the potential losses consumers face, governments and securities groups have long warned against investing in this asset class. However, as it seems increasingly likely that the US and other countries will make considerable investments in Bitcoin themselves in the coming year, financial commissions will effectively be forced to regulate the industry because regulation provides consumer protection.
The SEC will likely see a pro-crypto head installed in January, which will lead to a push for regulation.
Institutional Investment
The SEC’s eventual surrender to the launch of Bitcoin ETFs, and the subsequent launch of Ether ETFs, saw an influx of institutional money entering the market. This undoubtedly helped Bitcoin’s price rise during the year’s first half and underpinned its continued increase towards and beyond $100,000.
Not only will fund managers be investing in Bitcoin in the next 12 months, though. They will be joined by governments and government bodies, with strategic reserves potentially buying up millions of Bitcoins. This could see Bitcoin’s value rise substantially by the end of the year, and the more countries that get involved, the more the asset’s value will climb.
The Rise Of AI
Artificial Intelligence has become prominent across many industries, including blockchain and financial industries. Generative AI is already employed in customer service and other customer-facing roles, while AI coins have launched that can automate much of the crypto investment process.
Machine learning can help develop investment portfolios, while AI will become increasingly commonplace in blockchain development. AI is especially powerful when combined with big data, of which there is a lot in the blockchain industry.
Layer 1 Developments
Over the past couple of years, much blockchain attention has been focused on meme coins and tokens. Ethereum and Solana have become popular networks for project developers. Solana, especially, offers a fast and inexpensive layer 1 network to develop these coins.
We are likely to see more layer 1 networks established as governments, financial bodies, and central banks seek ways to elicit greater control over the blockchains they use.
Conclusion
Blockchain has the potential to change various industries. It has continued to gain prominence in 2024, and 2025 will continue to see innovations. However, with its introduction as a national strategic reserve and the likely introduction of new regulations, blockchain’s 2025 is expected to be a year of maturation and integration.
