Why 2025 could be crypto's biggest year yet

Source: Pantera Capital

Panteral Capital founder Dan Morehead recently discussed the development of the cryptocurrency industry in 2025 with Real Vision co-founder Raoul Pal.

Dan and Raoul have known each other for 25 years and both have been investing in the cryptocurrency space for more than a decade. Both acknowledged that 2025 could be a big year for the crypto industry.

The main content of the conversation is as follows:

Macro trends and Federal Reserve policies affecting cryptocurrencies

The conversation first discussed the impact of the Federal Reserve's policies on the economy and the cryptocurrency market. Dan believes that the Fed's long-term low interest rate strategy has led to a significant inflationary impulse, leaving the United States with limited tools to deal with growing debt and fiscal challenges.

Dan： “The Fed made a huge mistake by keeping interest rates too low for too long. It’s much harder to correct that mistake than to correct it bit by bit…

“The United States now spends more on interest than on defense, which is a crazy situation. Most countries, when faced with this situation, would inflate their way out of trouble. ”

The Growing Debt Crisis and the Role of Blockchain

As the global debt burden continues to grow, Dan and Raoul highlight the potential of blockchain as an alternative to the traditional financial system. They discuss Bitcoin as a “stateless currency” that can serve as a hedge against currency mismanagement.

Raoul: “Most people don’t realize it, but governments around the world are devaluing their currencies by about 8% every year. Bitcoin can hedge against this depreciation. ”

Dan: “We’re seeing a separation of money and state. Bitcoin is a currency that can do everything other currencies can do, but is not controlled by any one country. ”

Bitcoin’s Growth and Institutional Adoption

The discussion highlighted growing institutional interest in Bitcoin due to regulatory progress and ETF approvals. Dan predicts that institutional allocations to Bitcoin and other crypto assets will increase in the coming years.

Dan: “The launch of a Bitcoin ETF by BlackRock and Fidelity breaks the last barrier for institutional investors. Now, no one can say ‘we can’t invest in Bitcoin for compliance reasons’. ”

Raoul: “We see Bitcoin becoming a strategic reserve asset, not only for individuals but potentially for nations as well. ”

Middle East and Global Crypto Adoption Trends

The panel discussed the growing interest in blockchain in the Middle East as sovereign wealth funds begin to explore cryptocurrencies as part of their diversification strategies.

Dan:  “The GCC countries realize that blockchain is suitable for their needs because they are a frontier market with a lot of capital to deploy...

“Once the US establishes a strategic reserve of Bitcoin, we will see other countries, especially those seeking to hedge against US dominance, follow suit.”

Tokenization and Real World Asset Integration

The tokenization of assets such as real estate, treasuries and commodities was highlighted as one of the most exciting areas of blockchain innovation. Dan pointed out that there are already projects tokenizing billions of dollars of real-world assets.

Dan:  “Figure is providing $10 billion in mortgages on the blockchain. It’s not just talk – it’s happening…

“Ondo is tokenizing Treasury bonds, allowing anyone with a smartphone to borrow money from the US government. This is revolutionary. ”

Cryptocurrency is the fastest growing frontier economy

Both speakers agreed that blockchain represents the fastest growing economy in history, with the potential to expand from $3 trillion to $100 trillion in the next decade.

Dan: “Blockchain is a new economy. It’s like the birth of an asset class, just like emerging markets and commodities in the 1990s. ”

Raoul: “We’re only 3% done. When people ask me if it’s too late, I tell them, ‘No, it’s just the beginning. ’”

AI and Crypto Convergence

The intersection of AI and cryptocurrency is seen as a transformative area, with blockchain enabling decentralized governance, ownership, and incentivized data sharing for AI applications.

Dan: “AI agents need a native financial system, and blockchain is it. Decentralization makes AI more accountable and accessible…

“Blockchain incentivizes people to share private or valuable data for AI models, creating an economic value layer for AI.”

Generational Shift and the Sociopolitical Impact of Cryptocurrency

Dan noticed that the demographics of cryptocurrency adoption are changing, with younger generations driving the industry’s growth and even having a significant impact on the outcome of the US election.

Dan:  “Young people love crypto. It’s a way for them to build wealth in a system that’s priced them out of housing and other opportunities…

“Crypto is no longer a partisan issue. 50 million Americans own cryptocurrency, and being against it is political suicide. ”

Looking Ahead

Dan and Raoul concluded by reflecting on the opportunities in the cryptocurrency market, stressing that despite the growth to date, the journey has only just begun.

Raoul: “This is the biggest macro opportunity ever. Our job is not to screw it up. ”

Dan：“Blockchain is still in its first phase. Most institutions have zero allocation, but this is changing rapidly. ”