A naukri.com initiative
Insider
21h
0
Image Credit: Insider
6 factors that could make or break crypto in 2025: Citi
- Citi analysts pointed to six key factors that will help determine the price of crypto in the coming year, including ETF activity, regulation, and the future market for a type of crypto known as stablecoins.
- A supportive macro backdrop is expected by analysts into the first quarter, but the outlook thereafter is less certain. It could turn depending on Trump's economic policies and stock volatility.
- The continued inflows to spot ETFs will provide a further driver for crypto growth. Bitcoin spot ETFs have seen inflows of $36.4bn since they began trading in January, while Ethereum spot ETFs have garnered $2.4bn since hitting the market in July.
- Crypto portfolio allocation will be key to future returns. The Citi analysts say crypto returns need to be priced a few percentage points above equities' expected returns to justify a 1% allocation of portfolios.
- Stablecoin issuance will help create a healthier crypto market, and continued stablecoin issuance will likely help stablecoins continue to lead the way toward decentralized finance. More stablecoins entering the space could threaten long-time stablecoin leader Tether's leadership.
- Widespread adoption is required to produce returns beyond the post-election euphoria, say the analysts. Bitcoin volumes, stablecoin market values, and rising adoption in countries with currency problems, such as Turkey, Argentina, and Venezuela must be monitored.
- Regulation will be a reigning theme next year, and a shift from regulation by enforcement to a more legislative-based approach is expected.
- Crypto had a blockbuster year, registering a 90%+ increase in total market cap according to Citi analysts. The euphoria has pushed the total crypto market value to $3.4 trillion, almost double its size from last year, despite a sell off following hawkish remarks at the Fed's meeting last week.
- Paul Atkins, a crypto supporter, has been appointed chairman of the Securities and Exchange Commission (SEC).
- Crypto pioneers the Trump family will likely have a role in the industry.
Read Full Article
Like
For uninterrupted reading, download the app