Authors: Leo Mindyuk, Sarah Morton, CoinDesk; Translation: Deng Tong, Golden Finance

In today's article, MLTech's Leo Mindyuk provides a cryptocurrency outlook for 2025, emphasizing key factors that may drive the adoption of these assets.

2025 Cryptocurrency Application Outlook: Building the Bridge to the Mainstream

The cryptocurrency industry is entering 2025 with a new sense of mission. Over the past year, the industry has witnessed key developments that indicate cryptocurrencies are increasingly integrating into traditional finance (TradFi), with crypto assets—especially Bitcoin—seeing wider adoption. However, the road ahead will test the resilience of this evolving ecosystem. When assessing the outlook for 2025, there are several factors critical to shaping the adoption trajectory: regulatory clarity, institutional participation, and technological innovation.

1. Regulatory Clarity: Turning Uncertainty into Institutional Guidance

As I briefly discussed in the CoinDesk podcast regarding the election night results and price movements, regulatory transparency is becoming a key factor in cryptocurrency adoption. The market has begun to anticipate that newly elected officials will bring the long-awaited structure to the digital asset ecosystem. We will see some of these expectations beginning to take effect this year. Key areas where we might see more clarity include:

a) Definition and Classification of Digital Assets: The USA is expected to refine how digital assets are classified—whether as securities, commodities, or some combination. This clarity will directly affect how tokens are issued, traded, regulated, and taxed.

b) Stablecoins: These are likely to become a focus for regulators due to their transformative real-world use cases and potential impact on financial stability.

c) Taxation of crypto transactions: Recent changes have been made, and we might see clearer tax reporting requirements for digital assets, various related activities, and various Industry participants.

Other topics, such as tokenization (including real-world Assets), custodial and non-custodial wallets, regulated trading venues, decentralized finance (DeFi), anti-money laundering (AML) and know your customer (KYC) compliance, as well as Consumer protection, will also be actively discussed and may prompt action.

2. Institutional participation: ETF as a catalyst.

In 2024, crypto ETFs have experienced explosive growth, with net inflows reaching billions of dollars and launching attractive products. With the introduction of new products, crypto ETFs now represent a rapidly expanding financial market segment, attracting significant investor interest and outpacing traditional Funds. Various adjacent products might emerge.

By 2025, inflows and trading volumes of BTC and ETH ETFs are steadily increasing, potentially continuing to validate Cryptos as an Asset class and simplifying the entry process for retail and institutional investors. This will pave the way for other single-Asset ETFs, multi-Asset ETFs, and various adjacent ETFs (such as leveraged, inverse, market timing, volatility). If regulatory clarity progresses quickly enough, we might see the first ETFs in the USA generating cryptocurrency earnings (such as staking). These products could bring more investor interest to this Asset class and increase inflows into passive and active investment products.

3. Technological innovation: The fusion of blockchain scalability and AI.

Technological advancements in 2025 will be driven by second-layer blockchain scalability and AI integration. Aggregation, zero-knowledge proofs, and interoperability will enhance the trading efficiency and user experience of decentralized applications (dApps) and DeFi. Simultaneously, AI agents operating on decentralized networks will solve and optimize various tasks and interact with users and each other. This synergy simplifies Web3 interactions and ensures secure, transparent execution of AI decisions on the blockchain. These innovations will collectively lower entry barriers, attract developers and users, and accelerate mainstream adoption, making 2025 a pivotal year for the integration of blockchain and AI.

In summary, the adoption outlook for Cryptos in 2025 is very optimistic, but not without challenges. Regulatory clarity, institutional participation, and technological innovation will become pillars of growth. The question is not whether Cryptos will achieve mainstream recognition, but how fast and in what form it will be accepted. As we enter the next phase, those who adapt to the changing environment will lead the trends shaping the future.

——Leo Mindyuk, CEO, ML Tech

Question: What were the most influential developments in the cryptocurrency market over the past year? How do they affect the adoption of cryptocurrencies?

The most significant development in the cryptocurrency field last year was the political shift, with elected President Donald Trump making cryptocurrency an important part of his agenda. The market is just beginning to consider the impacts of the administrative and legislative bodies, as well as financial regulators, which not only avoided cracking down on the cryptocurrency industry but encouraged cryptocurrency innovation within the USA. Besides the adoption of Bitcoin and the potential establishment of a National Strategic Bitcoin Reserve, many market participants remain unclear about the broader impact on financial markets. Some of the largest global financial institutions that previously stood by are now actively developing cryptocurrency strategies to respond to the new pro-cryptocurrency government.

Question: How might the changing regulatory landscape affect the cryptocurrency market and institutional participation in 2025?

The enforcement and regulatory approach of the US Securities and Exchange Commission has profoundly impacted the cryptocurrency market. A shift towards a Neutral or even positive attitude means that financial professionals and institutions will need to actively explore how to better serve clients already involved in cryptocurrencies, especially considering the decisive role of cryptocurrencies in elections. Additionally, they will need to adjust their products to remain competitive in a world where financial markets and Assets are increasingly running on cryptocurrency tracks. In particular, financial advisors now have more opportunities to serve clients by incorporating cryptocurrency allocations and existing cryptocurrency portfolios into comprehensive financial planning and Global Strategy.

Question: Given the macroeconomic situation, how should financial professionals consider integrating cryptocurrencies into broader investment strategies in 2025?

The year 2025 will mark a critical shift in cryptocurrencies from merely an asset class to an infrastructure that supports the growing share of all asset classes. In other words, as the adoption of cryptocurrency tracks increases, financial professionals will be better able to respond to macroeconomic situations and further accelerate the flywheel of asset tokenization, portfolio allocation, and broader adoption.

—— Miguel Kudry, CEO of L1 Advisors