Did you know that, according to statistics, Bitcoin’s trading volume alone hit $19tn in 2024, up from $8.7tn in the previous year? Well, any keen investor will agree that 2024 was really a great year for digital tokens, which were once highly criticized. It was during this year that several exchange-traded funds were approved, the halving event happened and so much more.
Of course, these events had their own share of impact on the industry. For instance, after the ETF approvals, the industry saw daily trading volumes increase as more investors sought to benefit from that opportunity. Monitoring such trends is very important because they affect the USD to BTC value due to changes in demand. And since the consequences of these events could spill over to 2025, you definitely want to know what awaits.
What are experts saying?
As we have already hinted, the approval of Bitcoin ETFs brought many changes to this sector. For mainstream investors, this would mean regulated and secure exposure to the currency through their brokerage accounts. In fact, according to some experts, this meant the prices could be more stable in the coming days.
At a time when there is a growing need for online safety, ETFs have an opportunity to appeal to many. By storing tokens in a digital wallet using multiple security layers, these tokens help reduce risks like hacking. These improved features could actually be the reason investor activity increased.
Surprisingly, Geoffrey Kendrick, Head of Digital Assets Research at Standard Chartered Bank, mentioned that even a small allocation of US retirement funds in these ETFs could significantly increase BTC prices. This expert also highlighted the possibility of Bitcoin surpassing $200,000 by the end of this year (2025).
Other experts have similar expectations of crypto price increments. Just recently, Bernstein released a report claiming that holdings could reach $50 billion, doubling the 2024’s $24 billion. As if that is not enough, Galaxy Digital actually predicted that the spot Bitcoin ETF assets under management would exceed $250bn.
Why do these experts think so?
The need for more effective cross-border remittance
Imagine the pain of spending up to 6.25% on every amount you remit to a friend or loved one in another country. This might make more sense when you consider it a fraction of the $23.5 trillion that Fintech Finance suggests global corporations move across countries. If efficiency in these transactions improves, both businesses and individuals could register considerable benefits.
Have we even talked about how the associated confusion and limited transparency could actually lead to more business losses? According to this study, you might lose up to 3-5% of your transaction value because of confusion surrounding exchange rates. Plus, businesses may experience payment delays, which may lead to individuals preferring local suppliers.
Thankfully, crypto offers intriguing benefits that could help overcome some of these challenges. It’s designed so that funds can be cheaply transferred within a matter of seconds. You won’t need intermediaries who only complicate the whole process and make it more expensive. Its infrastructure is also decentralized to ensure transparency of all transactions.
This happens through crypto’s immutability, which prevents data from being manipulated once it's stored, improving traceability and transparency. As a result of such features, Bernstein experts expect more global businesses will turn to crypto for help. In fact, they recently forecasted stablecoin market capitalization to increase 2.5 times this year, with cross-border transactions being one of the contributing factors.
The growing trend of tokenization
Perhaps for those interested in gaming or real estate, tokenization is not new. This is where you create a digital representation of a real-world asset on a blockchain, allowing for fractional ownership. In gaming, it gives players more control over their in-game features and even allows them to convert them into real-world value.
And you’d be surprised that the tokenization industry made significant strides in 2024, growing by over 60%. Some companies have confirmed testing tokenized assets as collateral for other financial transactions to streamline operations and mitigate risks.
While there are still a considerable amount of challenges to be addressed regarding tokenization, the cumulative efforts to refine tech improvements in 2025 could set the stage for crypto’s further adoption.
This also means that more organizations may open up to DeFi technology. By the way, are you actually aware that, according to Motor Intelligence, the decentralized finance market size might hit $51.73 billion in 2025? And this growth is not expected to happen in 2025 alone—the coming years may see the industry grow by a CAGR of about 10.98% to reach $87.09 billion.
What is our final word?
It should not come as a surprise that some experts think the prices of currencies like Bitcoin could hit $200,000 in 2025. Given that transparency has become a critical issue, especially for global businesses, most could turn to crypto for help in 2025. Remember, digital currencies are usually decentralized and immutable, ensuring the traceability of transactions.
As if that’s not enough, there has been a growing need for more safe interactions online. This can't be overemphasized, especially now that cyber attacks are increasing. Since crypto is more secure, we could see more organizations welcome it to help them improve their security efforts. However, these are just speculations, so you may want to watch the industry closely, given its highly volatile nature.
