2024 Crypto Market Review and 2025 Outlook

2024 is an important year in the history of encryption. Centered around the two core narratives of ETFs and the U.S. elections, with Bitcoin as the main leverage, the crypto industry breaks through this year. Public companies, traditional financial institutions, and even national governments are flooding in, significantly enhancing mainstream recognition and acceptance. The regulatory environment is also moving towards a clearer and more lenient path with the new government taking office. Mainstream collisions, path differentiation, and regulatory evolution have become the main theme of the industry this year.

Review of 2024: Bitcoin Tops, Ethereum is Chased, MEME Track Gets Much Attention

Looking at the major developments in the industry this year, Bitcoin is undoubtedly the core narrative.

ETFs and national reserves have successfully pushed Bitcoin to $100,000, officially declaring Bitcoin's transcendence beyond the meaning of encryption currencies, extending its role as a robust global anti-inflation asset, with its value storage being recognized. BTC is gradually transitioning from digital gold to a super-sovereign currency, marking a significant victory in the financial experiment that began with Satoshi Nakamoto. On the other hand, the Bitcoin ecosystem has expanded this year. Although inscriptions, runes, and even L2 are experiencing a cycle of extreme highs and lows, a diverse Bitcoin ecosystem has begun to take shape. Applications in BTCFi, NFTs, gaming, and social interactions continue to develop, with Bitcoin's DeFi TVL skyrocketing from $300 million at the beginning of the year to $6.755 billion, growing more than 20 times over the year. Among them, Babylon has become the largest protocol on the Bitcoin chain, with a TVL reaching $5.564 billion as of December 20, accounting for 82.37% of the total. The broader BTCFi has also performed remarkably this year, as Bitcoin spot ETF shares surged, and MicroStrategy, selected into the NASDAQ 100, has been widely imitated, reflecting Bitcoin's overwhelming success in the Cefi space.

Returning to the public chain field, this year’s leading Ethereum has not had an easy time. Compared to other assets that are underperforming, value capture and user activity have declined, and the narrative is not as strong as before. The "value theory" has made Ethereum suffer greatly. The slogan for the revival of DeFi has taken shape, but apart from the TVL nesting frenzy caused by re-staking, it seems only a certain application is shouldering the burden, while actual investment is clearly insufficient. However, the emergence of a dark horse in derivatives at the end of the year has not only dealt a blow to centralized exchanges but has also sounded the horn for DeFi’s counterattack. On the other hand, after the Dencun upgrade, the competition within Ethereum Layer 2 has accelerated, continuously vying for a share of the mainnet, leading to a major discussion about Ethereum’s mechanisms in the market, with questions arising one after another. Even the rapid growth of Base has led to rumors that Ethereum's future belongs to a certain enterprise.

The strong rise of Solana forms a stark contrast. In terms of TVL, Ethereum's market share in public chains has dropped from 58.38% at the beginning of this year to 55.59%, while Solana has surged from being nonexistent at the beginning of the year to 6.9% by the end of the year, becoming the second-largest public chain after Ethereum. SOL has created a miracle of growth, skyrocketing from $6 two years ago to $200 today, with an increase of over 100% just this year. In terms of recovery path, leveraging its unique advantages of low cost and high efficiency, Solana targets core liquidity positioning and, relying on Degen culture, has risen to become the undisputed king of MEME, turning into a retail investor camp this year. This year, Solana's daily on-chain fees have frequently surpassed Ethereum's, and the growth of new developers has also exceeded that of Ethereum, showing a significant trend of catching up.

TON and SUI also stood out this year. A certain social platform with 900 million users has single-handedly ignited the blockchain gaming sector, creating a new entry point for Web3 traffic and providing strong stimulation to a market that had been quiet for a long time before September. Backed by a big tree, TON has finally transitioned from the long-standing eve of dawn into a fast lane of growth. Currently, the cumulative number of on-chain users of TON has exceeded 38 million, with a total transaction volume exceeding 2.1 billion USD. SUI, on the other hand, has completely captured people's attention, with rapid progress in the Move language public chain, hardware development, diverse protocols, and airdrop introduction working in tandem, seemingly promising a bright future. Compared to the price-driven SUI, the public chain Aptos, despite showing relatively weak price performance during the same period, has gained more favor from traditional capital, successfully establishing partnerships with several well-known financial institutions this year, and its compliant nature may usher in a dawn in the new RWA and BTCFI cycle.

From an application perspective, MEME is the main driver of the market this year. Essentially, the rise of MEME is a sign of the current shift in the market landscape, where VC tokens are not being recognized, excess liquidity has no assets to seek, and is ultimately funneled into sectors with stronger fairness and profit-seeking characteristics. Within this context, the connotation of MEME is also continuously expanding, gradually evolving from a single speculative target to a typical representative of cultural finance, "everything can be MEME" is happening in reality. Although in terms of market capitalization, MEME accounts for less than 3% of the top 300 cryptocurrencies excluding stablecoins (, its trading volume continues to occupy 6-7% of the share, recently even surging to 11%, making it the main track with the most concentrated liquidity. This year, MEME has captured 30.67% of investor attention, ranking first among all tracks. Where attention goes, money naturally follows. Looking at MEME this year, presale fundraising, celebrity tokens, zoo battles, PolitFi, and AI are all top players in the industry.

Against this backdrop, the infrastructure surrounding MEME continues to be solidified, and a fair launch platform has emerged, not only reshaping the MEME landscape but also successfully becoming one of the most profitable and successful applications of the year. In November, a certain platform became "the first Solana protocol to exceed $100 million in monthly revenue in history." As of December 22, the platform's cumulative revenue has exceeded $320 million, with a total of approximately 4.93 million tokens deployed.

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Of course, just because the platform makes money doesn't mean retail investors do. Considering the one in a hundred thousand odds of a golden dog, and with only 3% of users able to profit over $1000 on the platform, along with the increasingly prominent trend of MEME institutionalization, from the user's perspective, regardless of how fair it seems, being cut and cutting others is hard to avoid. Perhaps because of this, adding fundamentals to MEME has become a new development model for projects, with most longer-cycle projects like Desci and AIMEME adopting this model. However, for now, the fleeting moment remains mainstream, and the value of "running fast to live well" is still on the rise.

Affected by the U.S. elections, another legendary application has emerged. A certain prediction market platform has surpassed all existing betting platforms in the market, gaining fame for its high accuracy in prediction markets. In just October, the platform's website received 35 million visits, double that of other popular betting sites, and its monthly trading volume surged from 40 million dollars in April to 2.5 billion dollars. A large user base and real demand equate to clear value applications, which is no wonder that a certain well-known individual praised it highly. The only regret is that it has not achieved a large-scale conversion of encryption users. However, the new fusion of media and betting is undoubtedly approaching steadily.

As the year comes to an end, large models have transitioned from technology to application, clearly presenting a fierce competitive landscape. After a year of AI swaying around the Web3 hotspot, it has finally made a comeback as the dark horse of the year. MEME has ignited the spark, and a certain project is quickly approaching with the golden dog, recreating the hundred-fold myth and initiating a frenzy of the niche application of AI Agent. Currently, almost all mainstream institutions are optimistic about AI Agent, considering it the second phenomenal track after DeFi. However, as of now, the infrastructure in this field is still not well-developed, and applications are mostly concentrated on superficial layers like MEME and Bots, with limited deep integration of AI and blockchain. But new also means opportunity, and the speculative nature of cryptocurrency trading still needs to be observed.

On the other hand, from the perspective of the core driving forces behind this round of bull market, the seamless integration of traditional finance and Web3 through PayFi must be at the forefront. Stablecoins and RWA are typical representatives of this. This year, stablecoins have truly emerged in large-scale applications that many are looking forward to. They are not only growing rapidly in the encryption field but are also starting to take a seat in the global payment and remittance market. Regions such as Sub-Saharan Africa, Latin America, and Eastern Europe have begun to bypass traditional banking systems and directly use stablecoins for transaction settlements, with a year-on-year growth of over 40%. Currently, the circulating value of stablecoins exceeds $210 billion, significantly higher than the billions in 2020, with an average of over 20 million addresses conducting stablecoin transactions on public blockchains each month. In just the first half of 2024, the settlement value of stablecoins has exceeded $2.6 trillion. From the perspective of new products, a certain project has been the standout performer among stablecoin projects this year, further giving rise to the trend of interest-bearing stablecoins, which is also a major driving force behind the revenue of a well-known project this year. As for RWA, it was completely ignited after a large asset management company officially announced its entry; the market value of RWA, which was less than $2 billion three years ago, has expanded to $14 billion this year, covering multiple fields such as lending, real estate, stablecoins, and bonds.

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In fact, the development of PayFi is consistent with the pace of the market, and it is precisely because the internal market growth has encountered a bottleneck that the mainstream institutional market, as an incremental factor, is at the beginning of a new cycle. To seek incremental space, PayFi has entered a critical process at this stage. It is worth noting that due to the integration with the traditional financial system, this field is also the most favored Web3 track by government agencies.

Of course, although it seems to be improving, it cannot be denied that under the dual background of nearly two years of macro tightening and the industry's downturn cycle, the encryption field has also undergone an extraordinarily difficult pressure test. Innovative applications are difficult to emerge, internal disputes are intensifying, and restructuring and mergers and acquisitions are ongoing. The weakening of liquidity has given rise to a path differentiation in the crypto industry, forming a pattern where Bitcoin's core inflow continuously siphons off other cryptocurrencies. Most of this year, the altcoin market has been in a garbage time, only hitting bottom and rebounding under Wall Street's attention at the end of the year, marking the start of the altcoin season. From the current perspective, path differentiation will still persist in the short term, and there will be an increasingly intensifying trend.

Outlook 2025: New Cycle, New Applications, New Directions

As we return our focus to the present, the New Year's bell is about to ring, and looking ahead to 2025, as the new government ushers in a new era of encryption, well-capitalized institutions are also eager to take action. So far, more than 15 institutions have released their market predictions for next year.

In terms of price prediction, all institutions are optimistic about the value of Bitcoin, with 150,000 to 200,000 being the peak price range suggested by six institutions. Among them, several institutions believe the price will reach 150,000 or 200,000 dollars next year, and based on strategic reserves, some institutions even proposed a forecast of 500,000 dollars or even higher. As for other cryptocurrencies, multiple institutions provided predictions suggesting that ETH will be around 6,000 to 7,000 dollars, while Solana is expected to be between 500 and 750 dollars, and SUI could also rise to 10 dollars. Some institutions believe that the total market capitalization of the crypto market will reach 7.5 to 8 trillion, while others indicated that the total market capitalization of altcoins could increase fivefold.

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Price predictions are naturally supported, as almost all institutions believe that the U.S. economy will experience a soft landing next year.