Fidelity report: Who are the most noteworthy competitors in the crypto market in 2025?

Author: Yogita Khatri, The Block; Translator: Tao Zhu, Golden Finance

The Ethereum vs. Solana debate continues — with a focus on scalability, speed, and decentralization. Fidelity Digital Assets, the cryptocurrency arm of asset management giant Fidelity Investments, said Ethereum has an advantage but also acknowledged Solana's growth.

In its 2025 Outlook report, Fidelity highlighted Ethereum's strong fundamentals, including strong developer activity, total locked value, and stablecoin supply. While Solana's revenue and TVL are growing faster, the majority of its revenue comes from memecoin trading, which Fidelity sees as a cyclical trend that thrives in bull markets but fades in bear markets.

Fidelity also noted that Solana’s reliance on memecoins draws similarities to Ethereum’s heavy use of Uniswap. However, it believes Ethereum’s fundamentals are less tied to speculation and more stable in the long run. Fidelity said these fundamentals guide long-term investors but may not predict short-term performance.

Fidelity said: “Short-term price trends often revolve around narratives, and given the planned upgrades for both networks, Solana may be a more compelling contender in this regard for 2025.”

Solana’s Firedancer upgrade aims to significantly increase transaction speeds, while Ethereum’s Prague/Electra (Pectra) upgrade focuses on improving functionality, scalability, and user security. However, Fidelity noted that the Pectra upgrade may not generate much excitement in the community as it does not directly impact Ethereum’s value proposition from an investment perspective. Fidelity said Ethereum currently has a clear advantage over Solana due to its availability through exchange-traded products, though this could change depending on regulatory decisions. It added that such decisions could strengthen Ethereum’s position or level the playing field, making it a key factor to watch in 2025. Fidelity said that despite Solana’s short-term momentum, its performance could be positive for Ethereum in the long run, just as Solana’s underperformance was expected until 2024. As the bull run continues, investors are expected to focus more on fundamentals, which could shift attention back to Ethereum.

Fidelity's View on Bitcoin

In its 2025 Outlook report, Fidelity Digital Assets also shared its outlook on Bitcoin, saying that Bitcoin may still be a valuable asset in various economic scenarios in 2025.

Fidelity also expects that more governments, central banks and sovereign wealth funds will include Bitcoin in their treasuries in 2025, following the example of Bhutan and El Salvador. It said: "Faced with challenges such as inflation, currency debasement and growing fiscal deficits, not having any Bitcoin allocation may be more risky for the country than having a Bitcoin allocation."

On Stablecoins, Tokenization and DeFi

Fidelity acknowledged the rapid growth of stablecoins but noted that they are not yet a perfect product. It looks forward to taking further steps to address compliance risks, improve cross-chain interoperability and integrate with traditional financial systems. The report said stablecoins could coexist with tokenized bank deposits and improve the efficiency of tokenized securities trading while maintaining the dollar's status as the world's reserve currency.

Fidelity also called tokenization a "killer" application for 2025. The notional value of on-chain tokenized real-world assets has grown from $8 billion to $14 billion in 2023, the firm said, and is expected to reach $30 billion by 2025. Fidelity added: “As institutions increasingly recognize the advantages of leveraging blockchain — including faster, cheaper and relatively frictionless interoperability — we expect growth in the tokenized asset class is likely to continue to expand.” Fidelity said DeFi is also expected to continue to innovate in 2025, with growth in dedicated blockchains, decentralized social media, decentralized physical infrastructure networks (DePINs) and crypto AI.

It’s ‘Not Too Late’ to Enter Crypto

Fidelity believes mainstream cryptocurrency adoption will grow this year and says it’s “not too late” for investors to enter the space, despite Bitcoin’s recent breakout above $100,000.

“Indeed, we believe we may be at the dawn of a new era for digital assets, one that will last for years — even decades,” Fidelity said. “This era could see digital assets permeate every sector — industries, technologies, sectors, balance sheets, and even nation states.”