Predicting the Future: The 2025 Cryptocurrency Landscape Forecast Series

Kate Karimson, Chief Commercial Officer at R3 

The upcoming year foretells a significant phase of collaboration between public and private sectors within the blockchain realm, influenced by the US electoral outcomes that are set to bolster certainty in specific aspects and induce ambiguity in others. The landscape of cryptocurrency in America is anticipated to transform substantially by the conclusion of 2025, with the anticipated Republican governance in the White House and Congress poised to usher in eagerly awaited legislative reforms. These reforms intend to elucidate the functions of regulatory bodies and instill assurance, encouraging innovation within the industry. Despite the progressive momentum of Distributed Ledger Technology (DLT) in the US financial markets being impeded by regulatory vagueness, the advent of a concrete regulatory structure is predicted to provide a beneficial push.

Globally, the year 2024 has emerged as momentous, featuring partnerships within the industry that showcase the advantages provided by DLT-based infrastructures. For instance, the UK’s RLN initiative, orchestrated by UK Finance, brought together 11 leading banking and payment entities to develop a regulated ecosystem for digital currencies such as Central Bank Digital Currencies (CBDCs) and tokenized deposits. Given the widespread exploration of CBDCs by over 80 countries for national and cross-border applications, with a number in advanced implementation stages, the subsequent year is likely to see these projects maturing into operational systems. Nevertheless, the ambiguous stance of US Republicans regarding CBDCs might prompt other G7 nations to concentrate more on their internal projects.

Rob Wing, Head of Digital Assets and FX at 4OTC 

Over the last three years, the digital assets trading sphere has seen an influx of financial institutions. This trend is expected to persist through 2025, with investors broadening their investment portfolios to include various cryptocurrencies, such as Bitcoin and Ethereum. The recent election in the US and the inauguration of President Trump have already led to price escalations in certain well-established digital currencies.

A key obstacle for trading entities lies in establishing connections across the myriad of exchanges. The sector remains highly segmented, and it is not uncommon for institutional traders to engage with a range from five up to 25 different global exchanges to tap into crucial market data and liquidity. As digital asset trading becomes more entrenched within institutional settings, the demand surges for resilient, secure, and high-speed infrastructure that includes redundancy and comprehensive disaster recovery protocols. The impetus of trading is on the upswing, akin to the foreign exchange market, fueled by the expanding volume of data analysis and the advent of quantum computing, which empowers algorithmic trading to handle complex computations at breakthrough speeds.

Jon Light, Head of OTC Trading Platforms at Devexperts 

The year 2025 is projected to witness heightened regulatory activities within the crypto sphere. As the EU’s Markets in Crypto-Assets Regulation (MiCA) becomes fully applicable on December 30, other regions will keep a close watch on its effects upon the cryptocurrency market, and are likely to respond by crafting their regulatory initiatives. The US is poised to adopt a friendlier approach to crypto regulation under the Trump administration, particularly with the current SEC chairman, Gary Gensler, expected to step down in January. The UK is also in the final stages of releasing its comprehensive framework for cryptocurrency regulation in the early part of 2025.

This progression towards more stringent crypto regulations is set to diminish risks to the broader financial system. As digital currencies increasingly intertwine with the traditional financial sector, the imperative emerges for regulatory, worldwide coordination to prevent exploitation in weaker jurisdictions. Proper cross-border regulatory collaboration is essential for the cryptocurrency ecosystem to sustain its growth and attract more institutional investors.