Overview of the Three Main Themes in Cryptocurrency for 2025
This year’s cryptocurrency narrative revolves around three core themes:
- The market is rapidly becoming efficient
- Stablecoins are quickly globalizing
- Trump is playing 4D chess (or checkers)
Let’s break down these themes one by one.
1. The Market is Rapidly Becoming Efficient
Bitcoin and “Web3” are different things.
Historically, Bitcoin and other cryptocurrency markets have been interrelated through the flow of funds. After a rise in Bitcoin, profits would flow into Ethereum, and subsequently into other parts of the market. Today, Bitcoin is experiencing a genuine influx of institutional funds. These institutions are primarily purchasing Bitcoin due to its unique properties (sovereignty, permissionless access, and limited supply), compared to more controlled currencies around the world. The driving force behind this Bitcoin bull market is not focused on other parts of the market.
Many might argue that these funds would also flow into Ethereum, as it possesses similar attributes to Bitcoin. However, this has not been the case so far. While Ethereum is decentralized, its primary differentiating feature is smart contracts. This means that Ethereum’s intrinsic value is reflected in its usage, not just its technical properties. Institutions will buy Ethereum, but not because it is decentralized like Bitcoin. They will purchase Ethereum (along with Solana and others) because it is being utilized, much like they would buy growth stocks.
The brand of Ethereum is weakening.
The disappointing price performance of Ethereum has dampened the morale of the entire cryptocurrency sector, regardless of your level of support for Ethereum. This has also led to a general price decline (again, the impact of capital flows).
There are many reasons one could cite to explain its poor performance, with the rise of Solana being the most significant. Before Solana’s success, people found it easier to envision Ethereum’s future development rather than its current state.
The standards have been significantly raised, and the market has grown weary of waiting. The possibility of Solana surpassing Ethereum is very real and worth considering.
The average IQ of market participants has reached a historical high.
As cryptocurrency prices continue to fall, the market has become tougher, and more participants have lost everything and exited. Those who remain have solid reasons to continue holding.
On-chain data is now widely available. You can easily check the TPS (transactions per second), transaction fees, and application revenues for each chain. Many market participants do this regularly.
Moreover, market participants are actually delving deep into on-chain data. The current standard is that you either create a new experience or provide a better experience, or else you will be labeled as a scam or a waste of resources. No amount of storytelling can change this.
When you combine these dynamics (the decoupling of Bitcoin, the weakness of Ethereum, and the general wise nature of the market), you find that the market no longer tolerates empty talk. This may be very confusing for those who do not have genuine faith in the underlying technology being built. As prices fall, claiming that the entire industry is a scam and believing that everyone is secretly involved (especially those “evil” venture capital firms) becomes easier than ever.
2. Stablecoins are Rapidly Globalizing
Some quick data:
The usage of stablecoins reached an all-time high in 2025.
In the past six months, the daily trading volume of stablecoins has reached $20 billion.
Since the beginning of 2024, the total supply of stablecoins has increased by $100 billion.
I would not define stablecoins as the “killer application” of cryptocurrency, but rather see them as the first sustainable on-chain guiding mechanism for cryptocurrency.
The traditional cryptocurrency guiding mechanism is through speculation. After the price rises, people chase these profits. There can be different arguments about the sustainability of this approach, but it has largely driven the industry’s growth into trillions of dollars.
There is a difference (and trade-off) between entering cryptocurrency through speculation and using stablecoins.
Speculation typically leads people to explore the industry. Through speculation, you chase altcoins on centralized exchanges, and then somehow end up buying NFTs on a test network of a chain that hasn’t even launched two years later. You have this experience because you are constantly chasing profits in weirder places.
However, with stablecoins, you directly use stablecoins on-chain to transfer value. The downside here is that there is not much reason to explore further profits outside of this mechanism, as you have never chased profits. This is why, despite the rapid growth in stablecoin adoption recently, it has not translated into widespread speculative behavior in the cryptocurrency market.
Do not get me wrong; the adoption of stablecoins represents a sustainably growing on-chain economy. At some point, the world of stablecoins and the world of speculation will converge. But rather than the stablecoin community (the general public) lowering standards to cater to the speculator community (the gamblers), we need to raise standards and provide them with appealing and reasonable use cases, rather than merely attracting bettors. This is especially good because, as described in Theme 1, the market is becoming more efficient.
3. Trump is Playing “4D Chess” (or Checkers)
The Trump administration is good news for cryptocurrency, as it means that reasonable regulations may (hopefully) be developed. This will attract capital, builders, and users into the space.
At the same time, the Trump administration is also bad news for cryptocurrency because his economic policies are both extreme and unpredictable. This brings uncertainty, lowers risk appetite, and damages everyone’s coins. Is Trump really playing “4D chess”? No one knows.
The best way to understand Trump and the market is to imagine he is presiding over a game of “Red Light, Green Light” from “Squid Game.”
This week you will see this dynamic play out. Trump announced that he would not take a hard stance against China, and Bitcoin rose 10%. While this is reassuring, it is impossible to predict what the next headline will be.
Conclusion
New Bitcoin buyers are unwilling to purchase Ethereum or altcoins, Ethereum’s uncertainty has reached an all-time high, and market participants are becoming increasingly savvy. These factors all contribute to the market becoming more efficient, with almost all prices being affected in the short term.
The adoption and guiding of stablecoins will only increase. The on-chain economy is growing, the industry has intrinsic value, and these individuals have high standards for use cases.
Cryptocurrency will uniquely benefit from this administration, but risk assets will be affected until Trump relaxes his stance.
In summary, the common theme behind these three macro cryptocurrency trends is short-term pain versus long-term gain. It is easy to feel like things are dying, but I believe the reality is quite the opposite. 2025 is the healing year that cryptocurrency needs, and only then can we be fully prepared to take center stage.
This article is a collaborative reprint from: Deep Tide.