2025 promises to be a year where the international cryptocurrency market could witness an expansion in mainstream and institutional acceptance, largely due to the improvement in regulatory guidance and escalating values of cryptocurrencies.
Enthusiasm among cryptocurrency investors is growing, fueled by the remarkable year of 2024 that saw Bitcoin (BTC) reach an unprecedented peak price of $108,300 on December 17, nearly a month after Donald Trump’s election as U.S. President.
As regulatory clarity under Trump’s upcoming administration is anticipated, the cryptocurrency sector might witness another year marked by significant achievements, such as increased institutional involvement and a record number of international crypto investors, according to industry professionals.
Regulatory clarity to bolster crypto investor count to a new all-time high
2024 witnessed substantial progress in cryptocurrency regulations within major global markets.
Across Europe, the long-awaited MiCA (Markets in Crypto-Assets) bill – the globe’s initial all-encompassing regulatory framework for cryptocurrencies – officially came into force on December 30th, outlining extensive regulations for entities offering crypto services.
In Asia, Singapore is rapidly becoming a significant center for cryptocurrency due to its “balanced” regulations, leading to a doubling of annual digital asset licenses granted in the year 2024 compared to previous years.
In simpler terms, it’s impressive that Singapore has approximately 1,600 patents related to blockchain technology, around 2,433 jobs in the industry, and 81 cryptocurrency exchanges. This is quite remarkable considering its relatively small population of fewer than six million people.
According to Jonathan Levin, CEO at Chainalisy, these worldwide regulatory advancements are expected to encourage both individual and institutional investors to embrace this trend.
Levin predicts that both large and small investors will likely start using this more frequently within the next year, particularly because these new rules will provide a clearer understanding of the industry for everyone, according to his statement to CryptoMoon.
As an analyst, I can express this by saying: Implementing these new regulations not only bolsters trust within the industry, upholds market integrity, and strengthens consumer protection, but it also makes our sector more enticing for retail clients, thereby fostering a stronger relationship with them.
According to Levin, clear regulations could result in a record number of daily cryptocurrency users and stimulate the expansion of institutional products like Exchange-Traded Funds (ETFs).
According to a report from Triple-A’s 2024 Cryptocurrency Ownership study, it was estimated that approximately 560 million individuals worldwide owned cryptocurrencies, representing around 6.8% of the global population as of July 12.
Based on the growth in users, as reported by Lunu’s CEO Pavlo Denysiuk who heads a cryptocurrency payments company, it’s projected that the count of cryptocurrency owners might even double within the upcoming two years.
Denysiuk mentioned during the NFT Fest 2024 panel that this is the place for broader acceptance, not just here and now, but also in payment systems.
Institutional adoption set for boost from ETFs and governmental BTC reserve plans
Investment in Bitcoin through U.S. spot ETFs has facilitated greater institutional adoption, as these funds make it easier for conventional financial organizations to invest in Bitcoin.
In just under a year since their introduction, the combined value of Bitcoin ETFs approached $110 billion, reinforcing analysts’ forecasts that the peak of a Bitcoin cycle could reach $200,000 by 2025.
According to Chainalysis’ CEO, Levin, this trend suggests that institutional acceptance of Bitcoin as a financial asset class is likely to increase over time.
“This is likely to translate into continued institutional interest, and efforts by financial institutions and crypto businesses to build the infrastructure and resilience required to support this investor demand.”
A notable indication of Bitcoin’s growing acceptance in the U.S. is its increasing recognition as a means for saving money. This shift is being driven, in part, by the Bitcoin Act, a bill backed by Wyoming Senator Cynthia Lummis, which aims to establish a strategic Bitcoin reserve within the country.
Support for the Bitcoin reserve proposition is growing substantially due to U.S. President-elect Donald Trump’s win during the November 2024 elections and the incoming Republican Party’s control over the Senate, as stated by Anastasija Plotnikova, co-founder and CEO of Fideum.
I strongly believe that should the Bitcoin Act be approved by US legislators, as suggested by Adam Back, the co-founder and CEO of Blockstream and a renowned cryptographer, Bitcoin could potentially reach and surpass the $1 million mark.
Crypto adoption in lower-income countries poised for continued growth
As a researcher looking into the dynamic world of cryptocurrencies in 2024, I found that the activity surrounding these digital assets experienced a significant surge and reached new heights surpassing even the highs seen during the 2021 bull market, as per Chainalysis’ Geography of Cryptocurrency Report published in October of the same year.
In the first quarter of 2024, as per a recent report, the Chainalysis Global Index – a tool that assesses the global value of cryptocurrency transactions – reached an all-time high exceeding 0.75, indicating a significant increase in worldwide crypto activity.
2023 saw cryptocurrency adoption predominantly propelled by lower-middle-income nations; however, the surge in 2024 was due to an increase in crypto activities across all income groups worldwide. Interestingly, high-income countries experienced a decline in crypto activity at the start of 2024, as per the report’s findings.
As a seasoned crypto investor, I’ve noticed a significant surge in global crypto activities primarily due to the increasing practical applications of stablecoins and the groundbreaking introduction of US Bitcoin ETFs. This insight was shared by Levin during his conversation with CryptoMoon.
“There were many factors driving this, from the launch of the Bitcoin ETF in the US to stablecoins supporting real-world use cases in low and lower-middle income countries and DeFi activity increasing significantly in sub-Saharan Africa, Latin America and Eastern Europe.”
Countries with moderate to lower economies such as India, Nigeria, and Indonesia have shown a strong lead in the acceptance of cryptocurrencies, with India taking the top spot on the Chainalysis Global Cryptocurrency Adoption Ranking.
As a financial analyst, I find myself immersed in the dynamic world of cryptocurrencies, where I’ve witnessed an interesting development. In Latin America, I’ve seen El Salvador take a bold step by officially acknowledging Bitcoin as legal tender on September 7, 2021. This move has proven to be fruitful for the country, raking in approximately $31 million in profits over the past three years.
Despite bringing a $31 million profit, President Nayib Bukele’s decision to invest in Bitcoin attracted significant criticism following the drop of Bitcoin from its record high of $69,000 in November 2021, after the failure of the FTX exchange. The value of El Salvador’s Bitcoin holdings plummeted deeply into losses when Bitcoin reached as low as $16,000 during the bear market.
Adopting Bitcoin by El Salvador represents a substantial move towards Bitcoin’s increasing assimilation within the international monetary framework, as per Anndy Lian, an author and blockchain specialist in intergovernmental matters.
As a researcher, I posited that similar governmental endeavors could potentially accelerate Bitcoin acceptance across various nations, a notion I shared with CryptoMoon.
“As more countries ponder this path, we might see a gradual redefinition of what constitutes a ‘safe’ reserve asset. If Bitcoin becomes a staple in national reserves, it could fundamentally alter the landscape of global finance, pushing for more decentralized and digital approaches to economic stability.”
It’s possible that Bitcoin could become a significant store of value alongside gold in the future. In the last twelve months, the value of Bitcoin has increased by more than 131%, whereas gold prices have only grown approximately 30%. This information is based on data from TradingView.
2025 looks promising for cryptocurrency investors, given Bitcoin surpassed $100,000 on January 6, over two weeks before Donald Trump’s inauguration on the 20th. This event is viewed as a potential trigger for increased crypto prices due to anticipated regulatory clarity, boosting investor confidence.
The projected increase in Bitcoin’s value, estimated between $160,000 and over $180,000 by 2025, is expected to draw greater interest from investors towards the world of digital currencies.
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2025-01-08 19:38