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2024 Year Review
- In 2024, countries around the world began reaping the fruits of their battles against inflation. As inflation has gradually come under control, major central banks cut interest rates for the first time since the COVID-19 pandemic. Meanwhile, the global economy has remained resilient overall despite continued regional geopolitical conflicts. Global real GDP is expected to grow by 3.2% in 2024 and 2025, a slight decline from the 3.3% growth in 2023.
Under this backdrop, the total cryptocurrency market cap increased during 2024 to reach $3.9 trillion, a 127% growth year-on-year.
- One of the key milestones of the industry in 2024 was the launch of US spot BTC and ETH ETFs, which paved the way for institutional adoptions. The BTC ETFs recorded nine (out of 11) months of monthly net inflows, with a total net assets of $30.7 billion as of 29 November. ETH ETFs saw their highest month of net inflows of $1.1 billion in November 2024, and total net assets of $577 million as of 29 November.
- Bitcoin and its ecosystem embraced several exciting developments in 2024. Bitcoin price surpassed $100,000 on 5 December, propelled by the launch of US spot Bitcoin ETFs, the notable impact of the US elections on the cryptocurrency landscape, and the completion of the Bitcoin network’s fourth halving. Meanwhile, we also saw the development of Bitcoin L2s and the tokenisation of BTC in 2024.
- Ethereum’s Dencun upgrade was implemented in March 2024. This upgrade enhanced Ethereum’s scalability and reduced transaction costs by 99% on the Ethereum L2s, which accounted for over 80% of transactions following the Dencun upgrade. In August, Cronos Labs announced the mainnet launch of the Cronos zkEVM, the next-generation zero-knowledge (ZK) L2 focused on scalability, security, and innovation.
- AI is still one of the main narratives in 2024. The three key areas underpinning the convergence between AI and Web3 are decentralised compute, AI agents, and data tokenisation. Major tokens in the decentralised compute sector have seen substantial YTD growth.
- Solana gained traction in 2024, becoming the fifth-largest cryptocurrency by market capitalisation, fuelled by rising network activities, the rise of meme coins, and an overall bullish market environment. Over 67% of new tokens were launched on the Solana network from January to November. Pump.fun, a Solana meme coin launchpad that launched in January, has quickly gained popularity and recorded a new monthly ATH fee revenue of $105.97 million in November.
- Prediction markets gained substantial traction in 2024, capitalising on the year of the US elections. Polymarket arguably captured the largest trading volume, peaking in November 2024 at $2.6 billion and 294,000 active traders. This reflects a 378x and 160x increase, respectively, compared to November 2023.
- GameFi also made a comeback in 2024 with the rise of play-to-airdrop (P2A). One popular form of P2A is tap-to-earn, with notable games including Notcoin and Hamster Kombat. One of the enablers of the trend is Telegram and its integration with The Open Network (TON) blockchain. Hamster Kombat, launched in March 2024, reached 300 million players total in August. Those games also face sustainability issues after the token-generation events (TGE), as they witnessed a drop in user activities.
- Tokenisation of securities have gained traction, as financial institutions (e.g., Franklin Templeton, BlackRock) entered the sector. The total value of real-world assets (RWA) stands at $13.6 billion, marking a 62% increase year-to-date. This uptrend is led by tokenised US treasury debt, which increased 239% year-to-date and contributed to 19% of total RWA value.
One of the main drivers behind the popularity of tokenised treasuries is yield-bearing stablecoins, which offer stable prices, favorable yields, and accessibility across multiple blockchains. One major concern regarding yield-bearing stablecoins is the sustainability of their high levels of yield, especially for those based on RWAs that would likely come down in line with interest rates. Furthermore, stablecoins using treasury bills or securities as collateral can be seen as a form of centralisation.
- The decentralised perpetual volume rose by 50% from $110.1 billion in January to $165.0 billion in November, led by Hyperliquid, which accounted for 44.5% in trading volume in November.
- The total fundraising amount in the crypto industry reached $12.3 billion year-to-date (January to November), a 32% increase year-on-year and 19% higher than the total for 2023. However, this still falls short of the $40.6 billion raised in 2022. The total number of fundraising rounds increased by 25% year-over-year to 1,473.The blockchain service category remained the top for fundraising amount with $4.5 billion investments in 2024, accounting for 36% of the total fundraising amount. This is followed by chain and blockchain infrastructure, with $1.7 billion and $1.5 billion raised, respectively.
- We continued to see hacks and exploits in 2024. The total amount of money lost in cryptocurrency hacks reached $749 million till Q3 2024.
2025 Year Ahead
- Potential Bitcoin Reserve Plan: The global trend towards establishing Bitcoin reserves is gaining momentum, with more countries considering this option. This is likely to stabilise overall Bitcoin prices and even drive them higher.
- AI x Web3: AI will continue to develop in crypto, in areas such as intent, on-/off-chain verification, and distributed multi-agent systems. AI agents are expected to be able to execute more complex operations. In addition, a key research focus in blockchain is off-chain verification, addressing the computational difficulties associated with performing complex calculations directly on-chain. Another development direction is utilising a distributed network of nodes that independently operate a large language model (LLM) or agent that facilitates multi-agent systems with consensus.
- Prediction Markets: Although political events remain as one of the key drivers of the hype behind prediction markets in 2024, non-political events also gained traction. For example, Azuro is an infrastructure and liquidity layer for hosting on-chain predictions and game applications. It hosts over 30 applications covering various markets. Year-to-date volume on Azuro increased 5.3x compared to the same period in 2023.
- Stablecoins: Regulations surrounding stablecoins have become clearer in 2024 (eg. European Union’s MiCA legislation and Hong Kong’s stablecoin bill published in the gazette). We anticipate the regulatory environment will continue to emphasise enhancing transparency, reducing risks associated with stablecoin transactions, and promoting cross-border interoperability in 2025. Crypto.com’s roadmap for 2025 indicates that the company intends to issue a stablecoin named CDC Stablecoin.
- Crypto Market Size: As of November 2024, the number of crypto owners has reached 653 million. During the year, the monthly average adoption growth rate was 1.1%. Depending on market conditions, we expect the number of global crypto owners to reach 750-900 million in 2025.
In 2025, we expect more merchants to accept crypto as a payment method. This should align with more adoption following President-elect Trump’s proactive policies in crypto. Crypto.com’s 2025 Roadmap outlines plans for expanded offerings in both crypto and traditional finance including, access to banking, and cards.
- RWAs: We expect the continuous adoption from traditional financial institutions will continue to drive RWA growth in the coming year (examples of BlackRock, UBS and Goldman Sachs in 2024). Particularly, RWA could become a new way for small- to mid-size companies to raise funds. For example, Ant Digital Technologies assisting LongShine, a Shenzhen-listed company, in completing a new energy-based RWA tokenisation financing in Hong Kong.
- Institutional Adoption: In 2024, the launch of US spot Bitcoin (BTC) and Ether (ETH) ETFs provided institutional investors with easier access to cryptocurrencies and bolstered market confidence. Looking ahead to 2025, potential approval of ETFs on Solana (SOL) and XRP (XRP), as well as expected pro-crypto policies under Trump’s administration could further encourage adoption.
- Ethereum Pectra Upgrade: It focuses on improving Ethereum’s mainnet performance, with three key objectives: fix existing network issues, improve user experience, and prepare for future upgrades. The main EIPs are: Account abstraction (EIP-7702) – allows externally-owned account to run smart contract; Reduction in validator staking (EIP-7251) – increases the max balance validators can stake from 32 to 2048 ETH; Increase blob capacity (EIP-7742 and EIP-7691) – enhance L2 transaction throughput.
- Decentralisation and Revenue Sharing: Ethereum co-founder Vitalik Buterin intensified his calls for L2 networks to enhance their decentralisation by meeting a minimum decentralisation threshold, known as ‘Stage 1’. In addition, it is expected that more DeFi protocols adopt fee-sharing mechanisms and incentive structures (examples of Uniswap and Ethena). This movement towards revenue sharing could potentially reshape DeFi tokens from being merely speculative assets to valuable financial instruments, appealing to a new category of investors.
Read the report: 2024 Year Review and 2025 Year Ahead
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Crypto.com Research and Insights team
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