Bitstamp Monthly Briefing – December 2024
December brought a slowdown after November’s big rally, with the total market cap dipping slightly. But trading stayed strong, and standout assets like Bitget Token and Hedera saw impressive gains.
With 2025 kicking off, the market is gearing up for changes. Regulatory shifts, new blockchain tech, and rising institutional interest.
Here’s your quick rundown of December’s market trends, top and worst performers, and a look ahead to the coming year. Let’s get started!
Market update
The total crypto market cap declined by 4.5% month-over-month, reaching $3.18 trillion at the end of December. Trading volume on the leading crypto spot exchanges we monitor increased by 5% during this period.
Bitcoin's market dominance rose by 0.85 percentage points month-over-month to 58.1%.
Total crypto market cap (grey) and BTC dominance (green)
Past performance is not a reliable indicator of future results. The performance of crypto assets can be highly volatile. Data taken on January 1, 2025.
Best performing CMC 100 assets in December
- +271.4% Bitget Token (BGB) – The price surge was driven by regulatory approval in El Salvador, expansion into European markets, new partnerships and product offerings, and record-breaking trading volumes.
- +120.6% Virtuals Protocol (VIRTUAL) – Maintained a strong uptrend, fueled by increased interest in AI Agent Applications.
- +58.1% Hedera (HBAR) – Sustained strong momentum following the US election.
Worst performing CMC 100 assets in December
- -46.4% Core (CORE) – Retraced sharply at the beginning of the month after encountering strong resistance at the $2 level.
- -44.8% Celestia (TIA) – Lost momentum after a strong uptrend in November, erasing all the gains from the previous month.
- -42.4% Worldcoin (WLD) – struggled to maintain its earlier performance and experienced a steady decline after failing to break the $4 resistance level.
Past performance is not a reliable indicator of future results. The performance of crypto assets can be highly volatile. Data taken on January 1, 2025.
Key macro & crypto events in January 2025
- January 8: US FOMC Minutes
- January 14: US PPI MoM
- January 14-15: CfC St. Moritz 2025 Public Days in St. Moritz, Switzerland
- January 15: US Inflation & Core Inflation rate
- January 17-19: Bitcoin Medellin Conference 2025 in Medellin, Colombia
- January 18: Bitcoin Day Naples in Naples, Florida, US
- January 20-24: Web3Hub Davos 2025 in Davos, Switzerland
- January 22-24: WGMI 2025 in Miami, Florida, US
- January 22: Davos Web3 Roundtable in Davos, Switzerland
- January 25-26: The Counterparty in Miami, Florida, US
- January 29: US FED Interest Rate decision and press conference
- January 30-31: Ethereum Zürich in Zürich, Switzerland
- January 30-31: Plan ₿ Forum El Salvador in San Salvador, El Salvador
- January 30: Governing Council of the ECB in Frankfurt, Germany
2025 crypto market outlook: a comprehensive overview
The year 2025 promises to be pivotal for the cryptocurrency market, with a blend of bullish sentiment, emerging trends, and evolving technological and regulatory landscapes shaping the industry's trajectory. For a comprehensive outlook, we’ve gathered insights from Bitcoin Magazine, a16z, and Bernstein analysts, which highlight a data-driven, optimistic future driven by innovation, institutional adoption, and increasing mainstream integration.
Bitcoin: a bullish momentum
Bitcoin Magazine emphasizes a data-driven approach to 2025, using metrics like the MVRV Z-Score and Pi Cycle Oscillator. These indicators suggest significant upside potential for Bitcoin, drawing parallels to its exponential growth phases in previous cycles. Analysts project a possible price range of $140,000 to $210,000, driven by macroeconomic factors such as a weakening U.S. Dollar Index and an expanding global money supply. Bernstein forecasts align with these trends, predicting Bitcoin to reach $200,000 by year-end, bolstered by corporate treasury demand and institutional inflows into Bitcoin ETFs.
Bernstein notes that Bitcoin’s corporate adoption, led by firms like MicroStrategy, could double treasury investments to over $50 billion. Simultaneously, ETFs are expected to capture $70 billion in institutional inflows, further solidifying Bitcoin’s role as a long-term asset. This “sticky” demand represents a shift from speculative trading to strategic holdings, potentially reducing market volatility.
Emerging trends and innovations
Both a16z and Bernstein predict a surge in stablecoin adoption, driven by cost-effective cross-border payments and enterprise applications. Stablecoins, already pivotal in the peer-to-peer payment space, are expected to gain broader acceptance among small and medium enterprises (SMEs) and large corporations, potentially reaching $500 billion in market size.
The rise of decentralized autonomous organizations (DAOs) is gaining momentum with the introduction of legal frameworks like Wyoming’s DUNA, empowering decentralized governance. This trend reflects broader adoption of public blockchains for applications such as digital government bonds, enhancing transparency and efficiency in financial markets.
Bitcoin miners are diversifying into AI-driven data center operations; a shift highlighted by Bernstein. This integration of AI with crypto infrastructure may attract institutional interest and improve mining stability.
Regulatory and institutional developments
Regulatory clarity is expected to improve in 2025, particularly in the U.S., where the SEC and CFTC are anticipated to establish clearer frameworks for digital assets. This environment could spur a wave of crypto-related IPOs and encourage traditional financial institutions to expand their crypto offerings, including custody services and DeFi-focused funds.
Ethereum is projected to solidify its status as the second most valuable blockchain, driven by its deflationary supply dynamics and utility in decentralized finance (DeFi). As adoption grows, Ethereum is expected to attract additional institutional investment, enhancing both its price performance and broader ecosystem.
Mainstream integration and user experience
A16z emphasizes the importance of simplifying blockchain technologies to drive adoption. As user interfaces become more user-friendly, the industry could see passive crypto holders transition into active participants, expanding the user base for applications across DeFi, NFTs, gaming, and social platforms.
The emergence of dedicated app stores and decentralized marketplaces is eliminating barriers posed by centralized platforms. These innovations aim to provide seamless access to crypto services, fostering widespread adoption of decentralized applications.
Conclusion
The 2025 crypto market outlook presents a combination of optimism and transformation. Bitcoin’s growth potential, stablecoin adoption, and regulatory clarity are complemented by technological advancements in blockchain and AI integration. While challenges remain, the convergence of institutional interest, improved infrastructure, and mainstream integration positions the crypto industry for a landmark year in its evolution toward financial and technological maturity.
Recommended reads
Are We Bullish Enough?
In 2020, the author predicted that the S&P 500 could quadruple in nominal value by 2030 based on historical patterns of 10-year returns following similar prior 20-year performance. This projection, which initially seemed bold, now appears less far-fetched, given the index’s progress halfway to the target; especially when accounting for inflation. Adjusted for inflation, historical periods with comparable returns suggest more modest growth of 1.75x to 2.75x in real terms. While this predictive model has limitations and relies on overlapping data, it demonstrates a surprisingly strong historical relationship between past and future stock returns. Heading into 2025, the author maintains a medium-to-long-term bullish outlook on U.S. stocks, despite current valuation concerns.
Blockchain Unicorns
Blockchain technology now accounts for nearly 20% of global unicorns, with 237 blockchain ventures and crypto projects valued at over $1 billion by the end of 2024. This rapid growth, reaching a combined valuation of over $3 trillion in just 15 years since Bitcoin's inception, mirrors the development of Web1 and Web2 but at a faster pace. Public blockchain companies like Coinbase have experienced significant valuation increases, and analysts predict continued dominance in the financial space. Despite this progress, adoption remains in its early stages, with 93% of the global population and most major institutions yet to invest. As blockchain continues to revolutionize digital finance, the potential for historical returns remains immense for early investors.
The Where Are We in This Bitcoin Cycle: On-Chain Update
Bitcoin's recent surge past $100,000, with projections of reaching $200,000, underscores the importance of analyzing key on-chain metrics to anticipate market trends. Indicators such as Terminal Price, Puell Multiple, MVRV Z-Score, and Value Days Destroyed (VDD) highlight the current phase of the bull market, suggesting substantial upside potential remains. Metrics like SOPR and Active Address Sentiment, while pointing to profit-taking and temporary overbought conditions, still indicate healthy market dynamics with room for further growth. Historical patterns suggest a peak may still be months away, with resistance levels likely emerging between $150,000 and $200,000.
The Traps of Passive Investing
Michael Green, a prominent asset manager and former hedge fund manager, has spent years warning about the risks of passive investing, arguing that it distorts markets, concentrates capital, and could lead to instability. With passive strategies now accounting for nearly half of market control, Green claims they reinforce momentum, reduce price discovery, and undermine capital allocation to smaller companies. He warns of a potential market crash if passive inflows slow due to demographic shifts or economic downturns, as passive investors lack cash reserves to stabilize markets. While critics downplay his thesis as theoretical or self-serving, Green’s analysis resonates with some hedge fund managers and short-sellers grappling with a market increasingly dominated by algorithmic and index-driven trading.
No information in this blog is intended to provide any personal investment services or advice nor is it an investment recommendation. Clients are responsible for making their own investment decisions. Bitstamp accepts no responsibility for any damage and/or loss arising from the use of information provided herein. Past performance is not necessarily an indicator of future results. Please consider your individual position and financial goals before making an independent investment decision.
Bitstamp is licensed to engage in virtual currency business activity by the New York State Department of Financial Services. Licensed as a Money Transmitter by the New York State Department of Financial Services.
Not offered in the following states: Hawaii and Nevada
This blog post has been approved as a financial promotion by Bitstamp UK Limited which is registered with the UK’s Financial Conduct Authority. Please read the Risk Warning Statement before investing. Cryptoassets and cryptoasset services are not regulated by the Financial Conduct Authority. You are unlikely to be protected if something goes wrong. Your investment may go down as well as up. You may be liable to pay Capital Gains Tax on any profits you earn.