Opinion by: James Toledano, chief operating officer of Unity Wallet
2024 is the year crypto grew up. Throughout the industry’s short but turbulent history, this year marked a turning point for the legitimacy, integration and growing global acceptance of digital assets.
It’s tempting to reduce the narrative of 2024 to Bitcoin’s meteoric rise. Even more tempting is attributing this growth to the so-called “Trump bump,” fueled by the incoming US president’s pro-crypto stance.
The story of 2024 is far richer than politics and price movements. 2024 was the year crypto graduated from a niche, speculative asset to a serious player in the global financial system.
ETFs: bridging the gap between TradFi and DeFi
This year’s most transformative moment for crypto was the introduction (and subsequent explosion) of exchange-traded funds (ETFs). ETFs overcame the biggest hurdle to crypto’s maturation as a mainstream financial tool, bridging the gap between decentralized and traditional finance (TradFi).
The numbers speak for themselves. From Nov. 18 to 22, Bitcoin ETFs recorded a staggering $3.1 billion in inflows, bringing their total assets under management to $107.42 billion — an extraordinary figure given that ETFs only debuted this year.
This new accessibility is more than a convenience. It has fundamentally changed the profile of Bitcoin (BTC) investors. Institutional players and retail investors on both sides of the political divide have embraced Bitcoin via ETFs.
If crypto were a country, its combined market cap of over $3 trillion would place it on par with the United Kingdom’s gross domestic product and ahead of France’s as the seventh-largest economy globally.
ETFs have removed the technical barriers to entry, brought newfound legitimacy, and silenced critics who dismiss Bitcoin as a niche asset.
Regulatory clarity was a global turning point
Another milestone for 2024 was the long-awaited clarity in cryptocurrency regulation, particularly in the US. The exit of Securities and Exchange Commission Chair Gary Gensler and the ascent of Trump’s pro-crypto administration signals a strong foundation for a market previously plagued by regulatory uncertainty and, at times, hostility.
This shift will create a more welcoming environment for crypto businesses and investors. The renewed optimism in the US market will also bring back crypto businesses that shielded themselves from Gensler’s froideur.
In Europe, the Markets in Crypto-Assets (MiCA) framework promises enhanced consumer protection and market integrity, set to take full effect in 2025. Indeed, regulators across the globe will likely follow suit and begin to move the industry past its reputation for volatility and uncertainty.
Crypto as a hedge in an unpredictable world
To fully understand crypto’s 2024 rise, we must zoom out slightly and consider the broader macroeconomic and geopolitical context.
Inflation and the rising cost of living have dominated post-pandemic economies. While inflation has begun to cool, with the US Federal Reserve cutting the primary interest rate by half a percentage point after 11 increases in a row, people worldwide are still feeling the sting of their devalued fiat currencies.
Hyperbolic predictions earlier this year around the US dollar collapsing under the weight of inflation and $35 trillion in debt heightened Bitcoin’s appeal as a hedge.
Escalating geopolitical tensions have also driven demand for an apolitical, decentralized financial solution — or “digital gold.”
The dawn of “NewFi”
While 2025 may not replicate the same dramatic growth of 2024, the momentum will manifest in a stabler and more integrated ecosystem, with continued emphasis on practical use cases, self-custody and solutions that bridge traditional and decentralized finance — what can be called “NewFi.”
In 2025, NewFi will become more than a concept. The trust, scalability and familiarity of TradFi will combine with the openness, transparency and flexibility of decentralized systems. Given their increasing co-dependence, these two systems will continue to intertwine in novel and exciting ways.
The potential for crypto’s underlying technology is unprecedented, from more tokenized real-world assets to onchain identity tools. To draw a comparison between crypto’s journey and that of the internet — we are around the same place as the internet in 1995. In short, the best is yet to come.
2025 will also see the continuing growth and integration between artificial intelligence and decentralized finance (DeFi) in the shape of trading bot platforms and tools to help identify security threats and scams.
As we head into 2025, the industry’s trajectory is one of growth, integration and mainstream adoption, building on the strong foundations laid this year. Foundations that were driven by innovation, regulatory breakthroughs and macroeconomic shifts were not just one event, election or personality.
James Toledano is the chief operating officer of Unity Wallet. James has had years of experience in the DeFi industry and has closely followed cryptocurrencies and their price movements since 2010.
This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
