The 2025 Outlook on VC from the Perspective of Encryption: Market Performance and Potential Opportunities

With the arrival of 2025, the encryption industry is at a new development node. Over the past year, the market has experienced recovery, innovation, and adjustment, with leading projects consolidating their positions and emerging tracks quietly rising. As a barometer of industry development, VC has not only witnessed market changes but is also shaping the direction of the industry.

This article gathers the perspectives of several top VCs, reviews the highlights of 2024, analyzes current market opportunities and challenges, and makes predictions about future trends. Let us explore the "yesterday, today, and tomorrow" of the encryption industry together.

The Most Impressive Projects of 2024

In the past year, the encryption industry has welcomed new growth driven by market recovery and technological innovation. Some projects have made a profound impact both inside and outside the industry with their unique technological paths or business models.

Hyperliquid started as a high-performance perpetual contract DEX, attracting a large number of users. Its token issuance had no VC involvement, making it one of the most successful airdrops in the history of encryption. The platform is expanding its products, launching the HyperEVM ecosystem, and increasing the practicality of the spot ecosystem.

Pump.fun has successfully pushed the "Meme Launch Platform" to the top narrative, igniting a wave in the Meme market. This indicates that Web3 projects can achieve success by building practical, high-experience products that align with market demand.

In the DeFi space, established lending protocols like AAVE and Compound are revitalizing, while high-quality new players such as Morpho, Euler, and Ajna are emerging and worth paying attention to.

Pudgy Penguin has single-handedly revitalized the NFT track, showcasing the powerful energy of the fusion of Web2 and Web3 thinking.

Ethena's USDE stablecoin has performed impressively, establishing positions for profit through CEX, and collaborating with BlackRock to ensure long-term viability.

Bitcoin Market Trend Prediction

In 2024, Bitcoin saw significant gains, mainly benefiting from the spot ETF, the halving event, and optimistic sentiment following the U.S. elections. Looking ahead to 2025, several VCs believe that the bull market is likely to continue, with a high probability of breaking through $200,000.

There are views that, based on the technical indicators Pi Cycle and 2Y MA Multiplier, the Bitcoin top may be around $200,000. There are also VC predictions that the next phase peak will be between $120,000 and $150,000, followed by fluctuations between $100,000 and $150,000.

Unlike previous years, this market round will be influenced by external liquidity and reserve policies brought by ETFs, possibly maintaining a fluctuating upward trend and gradually moving towards higher price levels.

The Dispute Between Meme and "VC Coin"

The controversy over "VC coins" is an important topic for 2024. Some believe that large-scale VC funds struggle to generate excess returns and that attention should be focused on supporting early-stage projects that drive true innovation.

The conflict between Meme and VC coins is essentially a competition between the existing market funds and liquidity. Meme coins align with retail investors' psychology due to their full circulation and fair distribution, but most fail to provide long-term value support.

Resolving the VC coin dilemma requires undergoing a complete bull and bear cycle to rebuild trust and fairness. Project teams should consider practical application scenarios, stable cash flow, and an active community. Token design must take into account actual use and community value to strengthen interest binding.

Potential Tracks and Projects in 2025

RWA(Real World Asset) is expected to achieve blockchain accounting for global mainstream financial assets, with significant potential for increased penetration.

Re-staking as the grand narrative of 2024 may reach its peak in 2025. The market potential of ZK projects ( such as RiscZero and Ingonyama ) is gradually becoming apparent.

AI Agent shows promise in trading decisions, DeFi optimization, and asset management.

The PayFi track has attracted much attention, and an ecosystem that can achieve seamless low-cost payments is rapidly developing.

The integration of AI and blockchain has become an important direction, with decentralized AI infrastructure and agents rapidly emerging.

"Mass Adoption" Breakthrough

The payment sector is expected to become the first breakthrough for blockchain "Mass Adoption". Stablecoins show advantages in non-US dollar countries, and once a compliance framework is established, it will spur various innovative projects.

The Solana ecosystem has a leading advantage at the retail level. New front-end user experiences and embedded DeFi will drive adoption.

After the approval of the Bitcoin ETF, market volatility may decrease, shifting from a rapid bear and bull market to a long-term slow bull market.

Bull Market Phase Judgment

The current situation may be in the mid-stage of a bull market. After the ETF approval, Bitcoin will be included in the regulatory framework, which will reduce market volatility. It is unlikely to see a significant short-term decline in the future, and the market may shift towards a long-term slow bull.

The trend of institutions accumulating Bitcoin is significant, and the likelihood of a large-scale crash is reduced. In the short term, Bitcoin may have completed half of the bull market process.

Retail Investor Recommendations

1. Focus on high-certainty tracks, such as BTC, Meme coins, and AI narratives. Invest cautiously in old altcoins that lack new narratives.

2. Act according to the trend, understand market trends, and keep up with the hotspots.

3. Prepare "lossable funds", withdraw costs in a timely manner, and avoid excessive leverage.

4. Pay attention to risk management and prioritize blue-chip assets. Use security tools like hardware wallets.

5. Focus on high-quality sustainable development projects and avoid chasing short-term trends.

6. Maintain a sense of awe and prioritize risks. Strengthen self-cultivation and enhance professional abilities.