Delphi Digital 2025 Outlook: BTC's potential remains huge, Stable Coin will continue to rise

Original author: Stacy Muur

Original text compilation: Deep Tide TechFlow

Introduction

As the end of the year approaches, all kinds of research and predictions are coming. @Delphi_Digital recently released the 2025 Market Outlook, which provides an in-depth analysis of current market conditions and an outlook for future trends, covering a range of topics such as Bitcoin price movements, key trends, and risk factors.

Given the full length of the text, it takes a lot of time to read it completely. Deep Tide TechFlow hereby compiles an article translated by Stacy Muur on the core viewpoints of “2025 Market Outlook”.

This article divides the Delphi Digital report into three main parts: the rise of Bitcoin, the bubble of the altseason, and the future development trends. Currently, the market value of Bitcoin has reached about $2 trillion, while the performance of altcoins is lackluster. Looking ahead, the growth of stablecoins may bring hope for market recovery. At the end of the article, Stacy Muur also expressed her unique views on the encrypted market in 2025, believing that the encrypted market is evolving from the “wild west” to a more regulated alternative to the stock market. Web3 native users will be willing to take on high risks and engage in speculative trading, while newcomers will adopt prudent risk management, focusing on long-term value, and some narratives may be marginalized.

The Rise of Bitcoin

Once upon a time, the price of 100,000 US dollars for Bitcoin was considered a fantasy.

And now, this view has undergone a dramatic change. Bitcoin’s current market value is about $2 trillion - remarkable. If Bitcoin were viewed as a public company, it would be the sixth most valuable company in the world.

Despite attracting widespread attention, Bitcoin still has enormous growth potential:

• The market value of BTC accounts for only 11% of the total market value of MAG 7 (Apple, Nvidia, Microsoft, Amazon, Google parent company Alphabet, Meta, and Tesla).
• It accounts for less than 3% of the total market value of the U.S. stock market and about 1.5% of the total market value of the global stock market.
• Its market value is only 5% of the total public debt of the United States, and less than 0.7% of the global (public + private) debt.
• The total amount of funds in the US money market fund is three times the market value of Bitcoin.
• The market value of Bitcoin is only about 15% of the total global foreign exchange reserves. Assuming that central banks around the world allocate 5% of their gold reserves to Bitcoin, this would bring more than $150 billion in purchasing power to Bitcoin - equivalent to three times the net inflow of IBIT this year.
• The current global household net worth has reached a new record high, surpassing $160 trillion, which is $40 trillion higher than the pre-pandemic peak. This growth is mainly driven by rising house prices and a booming stock market. As a comparison, this number is 80 times the current market value of Bitcoin.

In a world where the Federal Reserve and other central banks are pushing for a 5-7% annual depreciation of currencies, investors need to pursue a 10-15% annual return in order to offset the loss of future purchasing power.

You need to know:

• If a currency depreciates by 5% per year, its real value will be halved in 14 years.
• If the depreciation rate is 7%, this process will be shortened to 10 years.

That’s why Bitcoin and other high-growth industries are in the spotlight.

The illusion of the cottage season

Despite Bitcoin setting one historical high after another this year, 2024 is not friendly to most altcoins.

• $ETH failed to break through the all-time high.
• Although $SOL has hit a new high, the increase is only a few dollars higher than the previous high point, which is insignificant compared to its market value and network activity growth.
• $ARB performed strongly at the beginning of the year, but its performance gradually declined as the year end approached.

There are many similar examples. Just look at the performance data of 90% of the altcoins in your investment portfolio.

Why is this happening?

First and foremost, Bitcoin’s dominance is a key factor. BTC has been exceptionally strong this year, with its price up more than 130% year-to-date, driven by ETF inflows and Trump-related factors, with dominance reaching its highest level in three years.

Secondly, there is a phenomenon of market differentiation.

This year’s market fragmentation is a new feature of the crypto market. In previous cycles, asset prices typically fluctuated in tandem. When BTC rises by 1%, ETH typically rises by 2% and altcoins rise by 3%, creating a predictable pattern. However, this cycle is very different.

Despite a few assets performing extremely well, more assets are in a state of loss. The rise of Bitcoin did not lead to a comprehensive increase in the prices of other assets, and the anticipated ‘altcoin season’ did not arrive as expected.

Finally, Meme Coin and AI Agents also play important roles in it.

The crypto market is always oscillating between “this is a Ponzi scheme” and “this technology is going to change the world”. And in 2024, the “hoax” narrative takes hold.

In the collective imagination of the public, the cryptocurrency market always oscillates between the “unified global financial system of future technology” and the “largest scam in human history” every two years.

Why does this narrative seem to alternate between two extremes and occur once every two years?

Meme Coin Super Cycle & Market Sentiment

The meme coin’s supercycle further reinforces the impression that the crypto market is a “Ponzi scheme”. Many are beginning to question whether the fundamentals of the crypto market really matter, and even consider it a “casino on Mars”. These concerns are not unfounded.

In this context, I would like to add a comment.

When Meme is referred to as the best performing asset of the year, people usually only focus on those“mainstream Memes” (such as DOGE, SHIB) that have already gained significant market value and successfully built a community. However, 95% of Memes quickly lose value after launch, a fact that is often overlooked. But even so, people still “willing to believe”.

! [Delphi Digital 2025 Outlook: Bitcoin Remains Huge, Stablecoin Will Continue to Grow] (https://piccdn.0daily.com/202412/24091630/0ctzp9v64e5crlfe!webp)

This belief has prompted many funds previously invested in altcoins to shift towards Memecoin - a few have profited, but most have not succeeded. As a result, capital inflows are mainly concentrated between Bitcoin (institutional funds) and Memecoin (high-risk investment), while most altcoins are being overlooked.

Delphi believes that 2025 will be a year of market transformation driven by technology, and these technologies will “change the world”.

But personally I am not so optimistic about this. In 2024, a large number of KOLs (Key Opinion Leaders) focusing on Memecoins emerged. When I tried to create a folder on Telegram that contains a channel of ‘truly valuable’ content (you can find it here), I found that almost all channels were discussing ‘ape calls’ (i.e., high-risk short-term investment advice). This is the essence of attention economy, and these narratives deeply influence market trends.

What is the next trend?

The growth of stablecoins and credit expansion

One of the main challenges facing the current market is an oversupply of tokens. With the push of private investments and public token offerings, a large number of new assets are entering the market. For example, in 2024 alone, the pump.fun platform on Solana launched over 4 million tokens. However, in contrast, the total market capitalization of the cryptocurrency market has only grown three times compared to the previous cycle, while in 2017 and 2020 it grew 18 times and 10 times respectively.

The two key missing factors in the market—stablecoin growth and credit expansion—are re-emerging. With lower interest rates and improved regulatory environment, speculative activities are expected to become active again, thus alleviating the current market imbalance. The core role of stablecoins in trading and collateral will play a crucial role in market recovery.

Institutional capital inflows

Until last year, institutional investors remained cautious about crypto assets due to regulatory uncertainty. However, with the SEC’s reluctance to approve spot Bitcoin ETFs, the situation began to change, paving the way for future institutional capital inflows.

Institutional investors tend to prefer familiar investment areas. Although a few institutions may dabble in Memecoins, they are more likely to focus on assets with fundamental support such as ETH/SOL, DeFi, or infrastructure.

Delphi predicts that the market could see a “full rally” similar to previous cycles in the coming year. Unlike in the past, this time the market will focus more on fundamentals-driven projects. For example, OG DeFi projects (original decentralized finance projects) may be in the spotlight due to their proven track record of standing the test of the market; Infrastructure assets, such as L1 protocols, could also return to glory. In addition, RWAs (real-world assets) or emerging areas such as artificial intelligence and DePIN may also become hot spots.

Of course, not all tokens will achieve three-digit gains as in the past, but the existence of Meme will become part of the market. This may mark a new starting point, a widespread crypto rebound driven by an overall market rise.

Note: Most institutional traders typically rely on options hedging strategies. Therefore, in the event of a “full rally”, the assets most likely to attract institutional interest will be those with options trading – currently mainly traded on Deribit and possibly Aevo platforms.

The argument about Solana

@Solana demonstrates the resilience of the blockchain ecosystem. After experiencing a 96% drop in market capitalization due to the collapse of FTX, Solana has seen an impressive recovery in 2024.

The following are its key performance highlights:

• Developer momentum: By hosting hackathons and handing out airdrops (such as the Jito airdrop), Solana has successfully rekindled the interest of developers and users. This increase in engagement not only drives innovation, but also creates a virtuous cycle where technology development and user adoption complement each other.
• Market Leadership: In the 2024 cryptocurrency market trends, Solana is leading in areas ranging from Meme to AI applications. Of particular note is its Real Economic Value (REV), which measures transaction fees and MEV, surpassing Ethereum by over 200%, demonstrating strong market vitality.
• Future Outlook: Solana is considered to have the potential to challenge Ethereum’s dominant position in scalability and user experience. Compared to decentralized Layer-2 solutions, Solana provides a seamless user experience and highly centralized ecosystem, which gives it a significant advantage in competition.

Stacy’s final thoughts

The current market conditions may be reminiscent of 2017-2018, when Bitcoin reached an all-time high of $20,000 on New Year’s Eve before starting to fall back in early 2018. However, I don’t think it’s appropriate to compare the crypto market in 2018 to 2025. The two are in completely different market environments – the once chaotic “Wild West” is rapidly evolving into a more regulated alternative stock market.

We need to recognize that the scope of the cryptocurrency market goes far beyond the discussion circles of Crypto Twitter (CT) and X platform. For those who are not active on these platforms, their understanding and perception of the market may be completely different.

Looking ahead to 2025, I believe the cryptocurrency market will bifurcate into two major directions:

• Web3 native users: This group is deeply involved in the crypto market, familiar with its unique way of working, and willing to take the high risk of participating in speculative transactions such as memes, AI agents, and pre-sale projects. These actions are reminiscent of the early “Wild West” era of the crypto market.
• Ordinary investors: including institutional investors and retail investors, they usually adopt more conservative risk management methods and tend to have a fundamental-based investment strategy. They see the cryptocurrency market as an alternative to traditional stock markets, focusing on long-term value rather than short-term speculation.

So, which areas are likely to be marginalized? Early-stage DeFi projects, RWA (Real World Assets), and DePIN (Decentralized Internet of Things) protocols that fail to take a lead in their field or blockchain ecosystem are likely to lose traction. That’s just one of my observations.

PS: This article summarizes the core views in @Delphi_Digital’s 2025 market outlook. If you want a comprehensive understanding of Delphi’s detailed predictions for 2025 and beyond, I strongly recommend reading their original research report.