2025: The Year of ETFs, Regulations, and Macro Shifts

Dear Investors,

Welcome to 2025! The year of the bull.

It’s been a wild ride, hasn’t it?

Back in December, I highlighted that a market correction was imminent—and it happened right on cue. The total crypto market cap corrected by?13.2%, a necessary breather after the explosive growth we saw in November after the US election.

For those of you who stayed calm, avoided over-leveraging, and stuck to your strategy, congratulations.

To those who took some profits during the rally and bought back at lower prices after the correction—you have my respect. That’s the kind of discipline that separates the great investors from the good ones.

But without further ado, let’s explore the important.

2024 in Review: ETFs and Institutional Adoption

Looking back, 2024 will be remembered as the year institutions truly embraced crypto.

• Bitcoin and Ether ETFs broke records, crossing $100 billion in AUM within months of their launch.
• Bitcoin ETFs alone now represent 88% of the AUM of all gold ETFs—a staggering achievement considering gold ETFs have been around for over 20 years.
• Together, Bitcoin and Ethereum ETFs are just $5 billion shy of matching the total AUM of gold ETFs.

This isn’t just any milestone—it’s a clear sign that the market is maturing and that Wall Street is finally starting to see crypto as a legitimate opportunity rather than something risky or obscure.

2025: The Year of Transformation

As we look ahead, 2025 will be shaped by three key drivers:

1. ETFs,
2. New regulations,
3. Macro conditions.

1. ETFs: Capital Inflows and Market Dynamics

The ETF story isn’t over—it’s just beginning.

We don’t know yet which ETFs will get approved this year. It could be Solana, Avalanche, Chainlink, or perhaps only a combination of Bitcoin and Ethereum-focused funds.

What we do know is this: ETFs will continue to bring in new capital from traditional investors.

This inflow will likely create a ripple effect, with crypto-native investors taking profits from large caps (like Bitcoin and Ethereum) and moving down the risk curve to smaller, high-potential assets.

These filings and potential ETF approvals will?drive the market narrative?and could increase the value of any of the mentioned altcoins by multiples of today’s values.

2. Regulations: A Pro-Crypto Shift

For the first time in history, the U.S. has a pro-crypto president and senate.

The November elections brought new hope for the industry. While changes won’t happen overnight, I anticipate a much-needed wave of regulatory clarity and eased restrictions.

This could unlock the potential of DeFi as the “backend” of finance, where banks and institutions build user-friendly frontends while leveraging blockchain for efficiency.

We may also see greater alignment between blockchain and AI, opening new pathways for innovation.

While these developments will not fully materialize in 2025, they will undoubtedly influence the direction of the industry for years to come.

3. Macro: Liquidity and Inflation Watch

The liquidity cycle that began in 2024 is expected to accelerate this year.

Global money supply (M2) is set to rise, fueling optimism and bringing new capital flows to risky assets, especially cryptocurrencies.

However, there are potential headwinds: rising inflation could force the FED to delay rate cuts—or, in a worst-case scenario, even hike rates again to combat inflation.

While this could introduce short-term volatility, the long-term outlook remains positive.

Outlook for 2025

I believe 2025 will be a major year for crypto. Institutional adoption is gaining momentum, regulatory clarity is on the horizon, and the macro environment is increasingly favorable for growth.

1. Industry Expansion and Institutional Growth

2025 is likely to witness traditional financial giants stepping further into crypto. From tokenized bonds to blockchain-powered payment networks, these innovations could not only enhance the market’s credibility but also unlock entirely new revenue streams for institutions.

Many giants are already stepping in: PayPal, Revolut, Robinhood, BlackRock, JP Morgan, Goldman Sachs, and more.

2. Altcoin Season and Sector Rotation

With major caps like Bitcoin and Ethereum leading the charge, I anticipate a potential shift down the risk curve. Altcoins in infrastructure, DeFi, or AI-driven crypto platforms could gain momentum as investors diversify portfolios to maximize returns.

3. Risks to Watch

While the outlook remains optimistic, rising global inflation and economic downturns in major markets like the EU or China could create short-term volatility.

4. Adoption Beyond Finance

Beyond finance, industries like healthcare and gaming may start tapping into blockchain’s potential. We see this as the beginning of a broader narrative where blockchain transcends financial speculation and becomes a key driver of technological progress.

Many major institutions are already using blockchain to track food, drugs, important machinery, or data that is often tampered with, such as car histories or health records.

5. Further Reading

Adding some of the 2025 outlooks and predictions from industry leaders:

1. Galaxy
2. The DeFi report
3. Bernstein
4. Paul Veradittakit
5. Sygnum
6. Messari (paid)
7. 21Shares

2025 stands as a pivotal year for crypto, driven by institutional growth, innovative technologies, and a more favorable regulatory landscape.

While challenges remain, the market’s evolution continues to inspire confidence in its long-term potential.

And my personal prediction? I see the total market cap climbing into the $7-8 trillion range—almost double from where we are now.

As always, stay disciplined, stay curious, and don’t let the market’s noise distract you from the bigger picture.

If you have questions or want to discuss your crypto strategy, feel free to reply to this email or reach out at [email protected].

Here’s to an exciting and prosperous year ahead!

Regards,

Matt Curda

LinkedIn | Twitter

Web | Investment Fund

Disclaimer: Individuals have unique circumstances, goals, and risk tolerances, so you should consult a certified investment professional and/or do your own diligence before making investment decisions. The author is not an investment advisor and may hold positions in the assets covered. Certified professionals can provide individualized investment advice tailored to your unique situation. This research report is for general educational purposes only, is not individualized, and, as such, should not be construed as investment advice. The content contained in the report is derived from both publicly available information as well as proprietary data sources. All information presented and sources are believed to be reliable as of the date first published. Any opinions expressed in the report are based on the information cited herein as of the date of the publication. Although the author believes the information presented is substantially accurate in all material respects and does not omit to state material facts necessary to make the statements herein not misleading, all information and materials in the report are provided on an “as is” and “as available” basis, without warranty or condition of any kind either expressed or implied.