The past year has been a wild ride in the cryptocurrency space. Once rife with fraud and falling prices, the crypto market has surged back in 2024. The cryptocurrency market is currently at a $2.66 trillion market cap, not far off its record high in 2021.
In this report, we’ll share the biggest trends driving the bull market and inspiring investors. Plus, we’ll discuss the regulations and environmental concerns that could shake the market in the near future.
Here are the crypto trends happening right now and those that are likely to continue through 2025 and beyond.
Bull Market Emerges After Approval Of ETFs
The value of Bitcoin surged 150% coming into 2024. Many believe this bull run could last well into 2025. The price of Bitcoin began 2024 at about $44,000 but had grown to nearly $70,000 by late May. In one survey, crypto experts said that Bitcoin could hit $77,000 by the end of 2024 and $123,000 by the end of 2025.
Two major factors influencing the bull market are the approval of spot ETFs and the upcoming halving event. Brokerages began designing Bitcoin ETFs as early as 2013, but the spot ETF wasn’t approved by the SEC until January 2024. These funds consist of crypto that’s purchased by the financial firm and then offered as shares to investors. The investors never actually hold any Bitcoin, but the ETF tracks with Bitcoin’s market value.
Demand for crypto has increased because these ETFs allow investors to hold a low-cost investment in Bitcoin without operating in a crypto exchange. This makes crypto more enticing for retail investors and wealth management advisors who run 401ks or IRAs. BlackRock and Fidelity have emerged as early leaders in the Bitcoin ETF market—BlackRock holds $15 billion in Bitcoin assets and Fidelity has $9 billion.
The Bitcoin halving event is the other factor driving up interest in crypto at the moment. Halving occurs roughly every four years. The last one happened in April 2024. On the halving event day, the reward for mining Bitcoin is cut in half. This decreases the rate at which new Bitcoin is mined, which many analysts say will increase demand.
Previous halving events have been followed by an eventual increase in Bitcoin’s price. However, the increase was not immediate and couldn’t be definitively attributed to the halving. In the six months following the last two halvings, there were gains of 51% (in 2016) and 83% (in 2020).
The Intersection Of AI And Crypto
In recent months, AI has been working its way into the world of cryptocurrency. AI tokens are cryptocurrencies that are directly related to an AI venture, such as blockchain protocols, decentralized web platforms, and decentralized machine learning platforms. The value of AI tokens has grown exponentially in 2024.
For example, Fetch.ai’s token (FET) increased 329% between mid-February and mid-March 2024. The platform merged its AI token with tokens from SingularityNET and Ocean Protocol, forming a new token: ASI (artificial superintelligence). The alliance between these companies aims to develop a decentralized approach to AI, as opposed to AI protocols dominated by large tech companies.
Funding, Mergers, And Acquisitions In The Crypto Market
2022 was a year of crypto bankruptcies, but investor confidence returned in late 2023. In the final quarter of 2023, investors put $1.9 billion into crypto-related companies. The largest investment, valued at $225 million, went to Wormhole, a company specializing in interoperability between blockchain platforms.
In February 2024, $485 million of VC funding was invested in blockchain startups. Investors say funding in the next year will focus on real-world applications of blockchain and the infrastructure needed to implement these applications. Bitcoin miners have seen significant stock value growth, with Marathon Digital up 590%, CleanSpark up 440%, and Riot Platforms up 350%.
As the halving date approaches, industry insiders predict smaller, less efficient mining operations will be acquired by larger companies. In February 2024, CleanSpark announced it would take over three mining facilities in Mississippi in a $19.8-million deal. In a merger of equals, Hut 8 Mining and US Bitcoin Corp. merged in November 2023, forming Hut 8 Corp. with a $1.14 billion market cap.
Increasing Regulation Of Cryptocurrency And Exchanges
The crypto meltdowns of FTX and others put a spotlight on the regulation of the industry. The SEC is the nation’s most active regulatory body in the crypto market. Gary Gensler, the head of the SEC, has been vocal about his support for more regulation in the crypto market, saying it is “rife with fraud and manipulation.”
The SEC’s stance is that crypto is a security, requiring crypto firms to register with the SEC and follow its disclosure requirements. In June 2023, the SEC sued Coinbase for not registering as a broker and Binance for mishandling customer funds, ordering Binance to pay $4 billion in fines. Some crypto companies are exploring options in other countries due to regulatory concerns, with Gemini looking to the UAE and Coinbase opening operations in Bermuda.
Crypto’s Growing Climate Impact
A pressing trend for the crypto industry is its energy and climate change implications. The environmental problems lie within a step of the cryptocurrency mining process called proof of work, which requires high levels of computing power. According to the Cambridge Bitcoin Electricity Consumption Index, the production of cryptocurrency uses about 1174 TWh of electricity per year—more than the total annual electricity usage of the Netherlands.
United Nations scientists found that 67% of the energy used in crypto mining comes from fossil fuels, and carbon emissions from crypto mining alone could push the world beyond climate goals made in the Paris Agreement. Mining also requires significant water usage. In an effort to address climate concerns, Ethereum launched The Merge in 2022, a software upgrade that cut miners’ energy use by 99%.
Real-World Assets Turn Digital With Blockchain Technology
Asset tokenization is another trend that takes advantage of blockchain technology. When a real-world asset (RWA) is tokenized, there’s a digital representation of it on the blockchain. Tokens can represent assets like real estate, art, bonds, and intellectual property, providing benefits such as automation, traceability, fractional ownership, and increased liquidity.
Financial institutions are taking an interest in tokenization. BlackRock launched its first tokenized asset fund, called BUIDL, in 2024, utilizing the Ethereum blockchain. In its first week, the fund brought in $240 million. Citigroup is also testing the tokenization of financial assets on a private blockchain, enabling 24/7 asset transfers and cutting processing times to minutes.
Predictions show growing interest in asset tokenization, with the market potentially reaching $9.82 billion by 2030. Boston Consulting Group analysts predict that up to $16 trillion worth of real-world assets could be tokenized by 2030, representing 10% of global GDP.
Global Officials Explore Central Bank Digital Currency (CBDC)
Banking systems worldwide are developing their own digital currencies, referred to as Central Bank Digital Currency (CBDC). This would create a virtual currency centralized and managed by central banks. CBDCs are currently being developed or tested in 132 countries, amounting to 98% of the world’s GDP.
CBDCs are fully operational in Jamaica, Nigeria, and the Bahamas, and China is piloting the largest CBDC trial in the world with the digital yuan, called e-CNY, being tested in 260 million wallets across 25 cities. By 2030, the Bank of International Settlements predicts 15 retail CBDCs and 9 wholesale CBDCs will be operational.
To connect various CBDCs, the bank messaging network SWIFT plans to launch a network of CBDC platforms, enabling cross-border use of various CBDCs and allowing banks to use their existing infrastructure for transactions. Despite growing global interest, U.S. officials say they have no plans to develop a CBDC due to privacy concerns and potential impacts on the cost and availability of credit and financial stability.
That concludes our list of the top seven crypto trends to watch right now. The cryptocurrency market has been almost completely unpredictable over the last several years. The bull market has been in control for the past few months, giving investors and crypto enthusiasts hope for a record-setting future. But with increasing regulation and climate impacts, it seems nearly inevitable that crypto’s future will be just as uncertain as its past.
