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Cryptocurrency markets will reach $7.5 trillion by 2025, says Bernstein. Seven ways to tackle the rally – DL News
- Cryptocurrency markets have flattened due to the Bitcoin halving.
- However, Bernstein predicts cryptocurrency markets will triple from $7.5 trillion to $1 trillion by 2025.
- Here are seven reasons why analysts are predicting a massive rally.
Cryptocurrencies are just heating up.
That’s more or less the conclusion of a new research report, which suggests that the total value of cryptocurrencies will triple to $7.5 trillion by 2025.
Bernstein researchers Gautam Chhugani and Mahika Sapra explained in a note to clients how seven factors can help them seize the rally opportunity.
Bitcoin
Bernstein sees Bitcoin on the rise $150,000 by 2025. “Unprecedented” inflows into 10 spot Bitcoin exchange-traded funds launched in January have now “strengthened our conviction.”
While inflows have slowed since early April, “this is a short-term pause before ETFs become more integrated with private bank platforms, wealth advisors and even more brokerage platforms.”
Ethereum
Ethereum, the world’s second-largest cryptocurrency, has grown 43% this year but has struggled keep up with Bitcoin.
“Ethereum has had to fight this situation with one hand tied” behind its back, Chhugani and Sapra wrote.
The reason? The U.S. Securities and Exchange Commission has yet to approve an Ethereum spot ETF.
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Most market watchers say Probabilities The number of US regulators approving similar funds – when the first application deadline is May 23 – is low.
However, Bernstein said a refusal could trigger litigation, similar to The case of grayscale to convert its Bitcoin ETF futures into a spot fund, which will bring the “ETH narrative” back.
Ethereum staking
Bernstein also advised investors to keep an eye on the economics of cryptocurrency staking.
This is where the likes of Lido and EigenLayer will continue to drive Ethereum’s growth over the next year.
Solana
Solana is still only the fifth largest cryptocurrency in the world, with a total value of $60 billion.
However, Bernstein said its single-layer integrated design, low transaction costs, fast processing and dominant market share in stablecoin volumes reflect “growing dominance as a payments powerhouse.”
It is set to grow alongside the payments giants Band adopt Solana’s characteristics, Chhugani and Sapra wrote.
DeFi
The crackdown on cryptocurrencies has predominantly focused on centralized exchanges such as Coinbase and Binance.
This will be positive for the growth of decentralized finance, Bernstein analysts say.
Tokenization
Tokenization is a big theme of 2024, with Black rock AND Franklin Templeton pushing further into this space.
Chhugani and Sapra wrote that this push will see new participants join the fray, both from the world of cryptocurrencies and traditional finance.
Crypto games
For years, Web 3 games have been touted as the future of video games.
Despite a wave of blockchain-based solutions hitting the market in 2021, none have captured the imagination of traditional players.
Now, venture capitalists and analysts predict that Web 3 games will return.
Bernstein analysts recommend investors to invest in Ronin Blockchain, which mainly focuses on gaming.
While it is his flagship game Axie Infinite has lost 95% of its value since its November 2021 high, Bernstein noted that Ronin has integrated 11 new games and has about three million active monthly users.
Eric Johansson is the news editor of DL News. Do you have advice? Reach out eric@dlnews.com.