Virtual Asset Industry and Market Outlook for 2025
Competition for Bitcoin holdings between nations begins
Accelerating global regulatory innovation for virtual assets
Focus on “Stablecoins” and “Tokenization of real-world assets”
The main Altcoins should enter the institutional framework
Image=Shutterstock
In 2024, the virtual asset (cryptocurrency) market has seen tremendous growth with various issues such as the United States Securities and Exchange Commission (SEC) approving a Bitcoin (BTC) spot exchange-traded fund (ETF). , the fourth halving of Bitcoin and that of Donald Trump. election as the 47th President of the United States with promises of pro-virtual assets.
Today we will take a closer look at the changes that the virtual assets sector will face during the year 2025 and the market outlook set by experts.
Competition for Bitcoin holdings between nations begins
With Donald Trump, who emphasized the importance of making the United States a Bitcoin hub, elected as the 47th US president, the international status of Bitcoin and other virtual assets is expected to rise further.
The virtual assets sector has suffered from the Biden administration’s regulation-focused policies. The U.S. Securities and Exchange Commission has filed lawsuits against global exchanges like Coinbase and Binance for supporting the trading of dozens of “unregistered securities,” and put pressure on Ethereum (ETH)-related projects like Uniswap (UNI) through headline investigations on Ethereum staking.
However, with Trump’s victory in the US presidential election, the tide has turned. Trump won favor with the industry by proposing commitments to virtual assets, such as planning to store Bitcoin as a national strategic reserve asset.
The plans of Trump and the Republican Party are well reflected in the “Bitcoin Act 2024” proposed by Republican Senator Cynthia Lummis (Wyoming). The bill includes specific plans for strategic accumulation of Bitcoin reserves, such as establishing a long-term Bitcoin storage strategy, accumulating 1 million BTC in 5 years, holding for at least 20 years and the introduction of a proof of reserve system for greater transparency and fairness. Senator Lummis also expressed her determination on her X (formerly Twitter), stating: “The United States must now win the race to acquire Bitcoin.”
The Korbit Research Center, in its “2025 Virtual Asset Market Outlook” report, predicted that “with Senator Cynthia Lummis’ proposal for the Bitcoin Strategic Reserve Assets bill, a Bitcoin competition between governments, similar to the space race between the United States and the Soviet Union during the Cold War, this could happen. »
Accelerating global regulatory innovation for virtual assets
The global regulatory environment for virtual assets is expected to evolve in a positive manner. Clarity in the European Union’s global Markets in Crypto-Assets Regulation (MiCA) and the Trump administration’s pro-virtual asset regulations could accelerate global innovation in virtual asset regulation , including in Asia.
On June 30, the European Union’s MiCA, which was partially implemented for some elements, was fully adopted on December 30. MiCA specifies comprehensive standards for the industry, including licensing requirements for virtual asset service providers, stablecoins and collateral, anti-money laundering (AML), and anti-money laundering (AML) financing. terrorism (CTF), consumer protection and virtual asset monitoring and enforcement.
The European Union has been gradually promoting the discussion and implementation of the MiCA bill since 2022. Virtual asset companies can now prepare for national regulatory frameworks and establish clear growth roadmaps based on these regulations.
As the European Union, one of the world’s leading economic zones, proactively introduces clear and comprehensive regulations on virtual assets, major countries such as the United States, Asia and Latin America are responding quickly to avoid losing their leadership in the sector.
Virtual asset-related bills promoted and passed in various countries △El Salvador, adoption of Bitcoin as legal tender in 2021 △Central African Republic, Bitcoin legalization bill (repealed in 2023) △Bhutan, hydroelectric mining of Bitcoin in as part of the national wealth strategy △United States, Bitcoin Strategic Reserve Bill (BITCOIN ACT 2024) △Brazil, Bitcoin sovereign strategic reserve (RESBIT) submitted to the Chamber / Image = Presto Research
The most important country is undoubtedly the United States. As mentioned earlier, discussions on various industry promotion measures, such as the Bitcoin Strategic Reserves Bill, are ongoing, and Gary Gensler, Chairman of the United States Securities and Exchange Commission, criticized for his excessive regulation, announced his resignation, and Paul Atkins, who emphasized clear regulation, was appointed to succeed him.
Also worth noting are changes within the US Congress. In last November’s election, a “red sweep” took place, with the Republican Party taking control of the White House and both houses of Congress. This laid the groundwork for delivering on Trump’s virtual asset commitments.
Coinbase, a global virtual asset exchange, expressed optimism in its “2025 Crypto Market Outlook” report, stating: “The current U.S. Congress is more crypto-friendly than any previous congress” and “Finally, the he opportunity has arisen for the United States to establish clear regulations for the virtual assets sector.
Number of pro-crypto lawmakers in US Congress / Image=Coinbase Research
Focus on Stablecoins and the tokenization of real-world assets
Many experts in the virtual asset industry predict that starting in 2025, the convergence of virtual assets and traditional finance will accelerate based on fiat “stablecoins” and “tokenization of real-world assets” ( RWA).
Stablecoins also showed exponential growth in 2024. Market capitalization increased by approximately 48% over 11 months through November 2024, to $193 billion, and trading volume more than tripled from a year ago on the other, to reach 27.1 trillion dollars. With blockchain-based transactions and payment services faster and cheaper than traditional finance, stablecoins are expanding their range of adoption.
It is also expected that the field of tokenization of real-world assets will develop based on the payment infrastructure of stablecoins. The market size for tokenized assets was around $8.4 billion at the end of 2023, but grew by more than 60% to reach $14 billion at the end of 2024.
Tokenized Asset Market Size Trend / Image=Coinbase Research
The use of tokenized assets can simplify the operational processes of various products such as government bonds, funds and corporate bonds, and support immediate blockchain-based payments and 24-hour trading , leading traditional financial companies like BlackRock to actively engage in the research and development of tokenized assets. assets.
Coinbase said: “The realm of tokenized assets extends beyond U.S. Treasuries, money market funds (MMFs), and derivatives to encompass private credit products, corporate bonds, real estate, insurance, etc. and “Although it may take time, gradual and continued development will take place thanks to obvious advantages such as immediate settlement, reduced transaction costs and simplified operations.
The main Altcoins should enter the institutional framework
After Bitcoin (BTC) and Ethereum (ETH), which entered the traditional financial market via spot Exchange-Traded Fund (ETF) products, large altcoins like Ripple and Solana (SOL) are also expected to enter the institutional framework.
Bitcoin and Ethereum spot ETF products approved by the US SEC saw significant capital inflows, leading the growth of the virtual asset market last year. In 2025, if the pro-virtual asset stance of the second Trump administration proves sustainable, the institutional inclusion of major altcoins could accelerate the expansion of the virtual asset market.
ETF products from Solana and Ripple have already submitted their applications and approvals for virtual asset index ETFs, including major altcoins alongside Bitcoin and Ethereum, could be secured.
Status of altcoin and crypto index ETF applications / Image=Korbit Research Center
The Korbit Research Center said: “Under the Biden administration, the possibility of approving spot ETFs for altcoins without CME futures ETFs was low, but if these criteria are relaxed under the Trump administration, we can await approval of spot ETFs for assets issued in spot. ETFs in other countries or launched as Grayscale products.
In 2025, the virtual assets industry is expected to see significant changes like this. Do you think that the virtual assets market can continue the wind of innovation and renewal in 2025, after 2024?
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Youngmin Lee, Bloomingbit reporter 20min@bloomingbit.io
