Cryptocurrency is moving towards a more mature stage, with rapid developments in areas such as on-chain finance, stablecoins, and Real World Assets (RWA). However, challenges remain in DAO governance, AI + crypto, and Web3 gaming. Future growth will depend on technological breakthroughs and regulatory evolution. This article is derived from a piece by James Morgan, organized, compiled, and authored by the Blockchain in Plain Language.
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Cryptocurrency is now in a stage that is more mature and clearer than ever before. While the market still experiences hype cycles, many sectors within the industry have demonstrated product-market fit (PMF) and possess practical application value beyond speculation. However, other areas remain in experimental or problematic stages, with unresolved challenges hindering large-scale adoption. This article will analyze the key drivers behind mass adoption, explore successful sub-sectors, and address those still facing significant barriers.
1. Core Technological Drivers: The Cornerstone of Cryptocurrency Growth
1) Low-Cost Block Space: L2 and High-Throughput L1
A significant breakthrough in the crypto industry has been the substantial reduction in transaction costs. The introduction of Layer 2 (L2) rollups and high-throughput Layer 1 (L1) blockchains has enabled developers to more easily build efficient and user-friendly applications.
L2 scaling solutions—Ethereum rollup projects such as Arbitrum (arbitrum.io), Optimism (optimism.io), and Polygon (polygon.com)—offer faster and lower-cost transactions while maintaining a high degree of decentralization and openness.
High-throughput L1 alternatives—Solana (solana.com), Aptos (aptosfoundation.org), and Sui (sui.io)—utilize parallel execution and different decentralization trade-offs to achieve high-speed and low-cost transactions.
Growth Reason: Lower transaction costs reduce the entry barriers for developers and users, driving the accelerated adoption of areas such as DeFi, gaming, and asset tokenization.
2) Wallet Upgrades and Seamless User Experience (UX)
A major barrier to cryptocurrency adoption has been the complex onboarding process, but this issue has seen significant improvement and will continue to optimize in the coming months.
Smart contract wallets—smart wallets such as Safe (safe.global) and Coinbase Wallet (coinbase-smart-wallet)—introduce gasless transactions, automatic recovery, and multi-signature security mechanisms, while supporting gas fee payment on behalf of users and chain abstraction, greatly enhancing user experience.
Social login and keyless authentication—using tools like Web3Auth and Privy, users can directly access wallets via email or phone number, eliminating the cumbersome management of mnemonic phrases.
Crosschain Intents—advanced wallets and DApps are integrating cross-chain infrastructure and supporting standards like EIP-7683, enabling users to seamlessly manage multi-chain assets and execute transactions through an “intention mechanism.”
Growth Reason: Lowering interaction thresholds makes it easier for non-technical users to enter, and the user experience of crypto applications is gradually aligning with traditional fintech, driving broader adoption.
2. The 2025 Crypto Industry Landscape: Validating Successful and Rapidly Growing Crypto Use Cases
Bitcoin ETF: A Catalyst for Institutional Entry
One of the most significant financial milestones for Bitcoin is the approval and launch of the U.S. spot Bitcoin ETF, which has sparked a surge of institutional investment. For the first time, regulatory clarity has not hindered cryptocurrency but rather propelled its development.
Institutional ETF Layout—BlackRock, Fidelity, and Grayscale have now launched regulated Bitcoin and Ethereum ETFs, making it easier for hedge funds, pension funds, and retail investors to gain compliant crypto asset positions.
Capital Influx—these ETFs have attracted billions of dollars in funding, further solidifying Bitcoin’s status as a new asset class within the financial industry, particularly appealing in the current uncertain market environment.
Traditional Financial Recognition—ETFs allow institutions to hold Bitcoin and Ethereum in a compliant and tax-efficient manner, similar to the adoption model of early gold ETFs. In the coming years, more crypto-based ETFs will inevitably be launched.
Growth Reason: Bitcoin is now viewed as “digital gold,” while Ethereum may be likened to “yield-bearing bonds.” The widespread interest from institutions validates its value as a long-term hedge against inflation and fiat currency instability. With increasingly clear regulatory frameworks, institutional confidence in entering the market rises, leading to greater liquidity, broader adoption, and deeper integration between the crypto industry and traditional finance.
3. Stablecoins: The “Killer App” in Payments
Stablecoins have become the most widely used financial products in the cryptocurrency space, effectively addressing real-world problems and inefficiencies in payments and cross-border remittances.
Circulation Scale Exceeds $220 Billion—USDT (tether.to) and USDC (circle.com) dominate global crypto payment transactions.
Payments and Remittances—applications like Strike (strike.me) utilize stablecoins to facilitate near-instant cross-border transfers with almost zero fees, significantly reducing international payment costs.
Traditional Finance (TradFi) Adoption—Coinbase connects TradFi with DeFi through Base, PayPal has launched PYUSD, and major banks are exploring the application of tokenized deposits.
Enhanced Payment Networks—SpaceX uses USDC to process payments for Starlink customers, particularly in countries with high currency volatility, leveraging stablecoins to hedge foreign exchange risks and optimize payment processes.
Growth Reason: Stablecoins offer faster, cheaper, and more efficient ways to transfer funds, naturally outperforming traditional banking systems. Ultimately, users may not realize which payment network they are using, but stablecoins will undoubtedly replace traditional, slow, and inefficient payment infrastructures.
4. DeFi: The Cornerstone of On-Chain Finance
Despite facing security vulnerabilities and market volatility, DeFi protocols remain the core pillar of on-chain finance and continue to grow. I firmly believe in the tremendous advantages of DeFi in providing permissionless, decentralized, and equitable financial services.
On-Chain Lending—Protocols like Aave and Compound provide instant, permissionless credit markets without the need for traditional financial institutions.
Automated Market Makers (AMM)—Decentralized trading protocols such as Uniswap and Curve handle billions of dollars in transactions daily without intermediaries, enhancing market liquidity.
Tokenization of Real World Assets (RWA)—Ondo Finance and Maple Finance bring traditional financial assets on-chain, achieving more efficient financial infrastructure.
Growth Reason: DeFi offers a faster, more efficient, and globally accessible financial system, providing higher yields than traditional banks. Composability allows for more flexible capital flows, driving the emergence of innovative financial models while also integrating with existing financial concepts to create new growth points.
5. Tokenization of Real World Assets (RWA)**Tokenization: The Future Adopted by Institutions**
RWA is one of the areas of greatest interest to institutions, with major financial organizations actively tokenizing assets such as bonds, real estate, and secured credit, driving the migration of traditional finance onto the blockchain.
Secured Credit & Bonds — Companies like Centrifuge (centrifuge.io) are tokenizing debt instruments, lowering financing thresholds and making capital more accessible.
Fragmented Ownership — Relevant platforms allow users to hold real-world assets like real estate in shares, reducing investment thresholds and increasing market liquidity.
Collectibles as RWA — Platforms such as Courtyard.io support the custody, tokenization, and trading of physical assets, making the collectibles market more transparent and tradable.
Growth Reason: Bringing traditional financial assets onto the blockchain makes capital markets more liquid, efficient, and transparent, creating entirely new opportunities for institutional investors.
**6. Memecoins: Turning Speculation into “Function”**
Despite facing criticism, memecoins remain the most enduring speculative assets in the crypto market, continuously attracting capital and attention.
Rise of Popular Tokens — Memecoins like PEPE, DOGE, and SHIBA have market capitalizations reaching billions of dollars, with thousands of new meme tokens emerging daily.
Trading Volume Surpassing “Serious” Tokens — At certain times, the trading volume of memecoins has even exceeded that of mainstream crypto assets, with involvement from presidents and their teams boosting market sentiment.
Growth Reason: Speculation is a human instinct, and memecoins cleverly blend viral spread, cultural resonance, and a “gamified” trading experience, making the crypto market more entertaining. “Meme Tokens” and “Meme Infrastructure” will continue to rise and fall repeatedly in the market, becoming an indispensable part of the ecosystem.
**7. Digital Product Passports (DPPs) and Commodity Tokenization**
Luxury brands and enterprises are leveraging blockchain-based verification systems to enhance product authenticity and supply chain transparency.
DPP as a Service (DPPasS) — Platforms such as Arianee and Crossmint are driving the development of DPP solutions, with several non-blockchain DPP service platforms (DPaS) entering the competition.
Luxury Brands Leading the Trend — Luxury brands including LVMH, Prada, Breitling, and Cartier have been the first to adopt DPP technology, pushing the entire high-end consumer goods industry closer to blockchain verification.
EU Regulation Driving Mass Adoption — The EU’s DPP regulatory framework is a significant driver of growth in this area. However, if the EU relaxes regulations, this process may be delayed. Nevertheless, regardless of regulatory changes, blockchain remains the ideal technological support for product passports (DPP) in various scenarios such as authenticity verification and traceability.
Growth Reason: Businesses require transparent and anti-counterfeit product tracking systems, and upcoming regulations (such as the EU’s DPP initiative) are accelerating the adoption of this trend.
**8. Persistent Problem Areas**
Despite certain areas of the crypto industry proving their value, some sectors remain uncertain, overly hyped, or in early experimental stages. These areas face challenges in technology, regulation, or adoption, making widespread acceptance difficult until these issues are resolved.
DAO (Decentralized Autonomous Organization) — Low governance participation, inefficient decision-making, and chaotic fund management continue to be major pain points for DAOs. While DAOs like ENS and Gitcoin operate well, most still struggle to balance decentralization with governance efficiency. I am optimistic about the combination of AI and DAOs as a potential solution—ironically, DAOs may need AI to truly demonstrate their value and even expose the true nature of decentralized governance.
AI & Crypto — Beyond speculative hype, current practical applications of AI + crypto remain limited. While decentralized AI projects like Bittensor and Render Network are intriguing, they remain niche areas, and most AI tokens’ adoption is still stuck in low-value applications such as meme AI robots. The intersection of AI and crypto still requires groundbreaking practical use cases to truly flourish.
Gaming & Metaverse — Web3 gaming has yet to deliver on its promises, with Play-to-Earn models nearly extinct and the integration of blockchain diminishing the gaming experience. The hype around the metaverse has cooled, as failures of high-profile projects (like Meta’s VR strategy pivot and Decentraland’s stagnation) indicate that users are reluctant to enter virtual worlds solely for the sake of the “metaverse.” However, I still look forward to the development of AR glasses, which may provide a mixed “meta-metaverse” experience and drive a new round of exploration in the industry.
**9. Final Thoughts: What’s Next?**
As the crypto industry continues to evolve, the next wave of growth will likely be driven by significant technological breakthroughs, regulatory changes, and emerging narratives. Here are some reflections on the future…
On-Chain Finance will further expand its suite — Stablecoins continue to grow rapidly, and RWA tokenization will merge traditional capital markets with DeFi, potentially attracting trillions of dollars in institutional investment. The key question lies in the pace of regulatory progress, which will determine whether this transformation can truly materialize.
The role of Bitcoin will change — As ETFs attract institutional investment, Bitcoin may gradually encroach on the global digital reserve asset market share, or it may remain merely a value storage tool lacking scalability, supplanted by more functional blockchains.
Staking ETH ETFs will disrupt traditional finance (TradFi) — Once ETFs supporting staking rewards go live, Ethereum may become the first cryptocurrency regarded as a “yield-generating asset,” altering portfolio structures and posing a direct challenge to the bond market.
Identity verification will become a key domain — With the explosive growth of AI deepfakes, fraud, and robotic activities, crypto-native identity solutions (zero-knowledge proofs, WorldCoin, DID standards) will either gain widespread adoption or become a regulatory nightmare. If the latter occurs, we may find ourselves reduced to “digital puppets” controlled by AI or governments and corporations.
Tokenization of commodities & consumer-level adoption — Can NFTs transcend their collectible nature and integrate into real business scenarios? If brands and enterprises can successfully integrate DPPs (Digital Product Passports) deeply and create sufficient value for users, blockchain may quietly become the infrastructure for the retail e-commerce sector.
Memecoins and speculation will not disappear — Despite controversies, memecoins have proven the essence of the crypto market: speculation, community-driven, and viral narratives. In the future, they may evolve into a new form of social finance or merely remain in an endless speculative cycle. Regardless, I won’t easily bet against the failures of the casino.
The coming years will determine whether cryptocurrencies fully integrate into the global financial system or continue to exist as a high-risk, high-reward “niche market.” Which narratives will dominate the next cycle? The answer is still being written.
