Year-End Series: 4 Scenarios and 11 Predictions for 2025

Author: Kyle , crypto researcher

Compiled by: Felix, PANews

Since this bull market cycle started in 2024, the cycle so far is: BTC ETF launch on January 10 → Until Bitcoin’s all-time high, boosting the alt season, entering the volatile second quarter/third quarter of 2024, Bitcoin It continued to break through $50,000 and $60,000, and is currently hovering at $90,000.

It is worth noting that the altcoin season started when BTC reached a high. In the first round, BTC moved towards $69,000, but failed to break through properly. The next round was towards $100,000.

The next alt season is likely to be Bitcoin stabilizing at $100,000, hopefully in the first quarter of 2025. But the story of Q2/Q3 2024 may be playing out again in the coming months. Here are all possible scenarios:

Scenario 1 : BTC + altcoins generally rise. All the way up in 2025 and then into another alt season as BTC continues to rise and all coins are doing well and will repeat the last 2 months with everything rising (30-40% chance).

Strategy: Pick out-performing altcoins and buy them on dips.

Scenario 2 : BTC rises, altcoins rise less; story repeats in 2024, up and down over the next few months, but more bullish than 2024 (because BTC rises); so choose a good performing coin (50- 60% probability).

Strategy: Buy on dips in selected altcoins. Avoid the tracks with high attention and find the next "get rich coin"

Scenario 3 : BTC rises and altcoins generally fall (20-30% probability).

Strategy: Sell all altcoins. Scale back your altcoin investments; if your altcoin holdings do not rise for a long time, you may have to sell them all.

Scenario 4 : BTC falls, altcoins generally fall. Everything has peaked (10-20% chance).

Because of the macro favorable conditions, a new BTC ATH breakthrough may not take as long as it did in 2024. In this hellish summer, the ETF has just been launched, and TradFi is still struggling to sell the BTC story to customers. Most importantly, the outside world generally does not believe in the importance of Bitcoin.

Now that Trump has won the election, discussions about a strategic Bitcoin reserve are underway. Although the establishment of a strategic Bitcoin reserve is unlikely, the reputation of Bitcoin has changed.

It’s the narrative that matters — the fact that we’re in a new regime that’s brought new attention to the digital asset space, and now that the next U.S. president is talking about Bitcoin so frequently, it’s much easier to convince people to buy it .

This regime change is extremely important. Therefore, BTC will continue to have tailwinds in 2025. For altcoins, the situation is similar, but different.

Total3 (the total market cap trend of all altcoins) hit a 2021 all-time high in Q1 2024 before reaching a cycle high in Q4 2024. It more or less follows the same pattern (scenario 1 and scenario 2 above are not that different).

The key is positioning and timing. Although optimistic about 2025, we don’t know how long it will take. While the rally in 2025 will likely come sooner than in 2024, altcoins can still fall significantly during periods without catalysts.

As long as the cycle is not over, stay long whether it’s Bitcoin or altcoins. There won't be a repeat of the summer of 2024 in 2025, and although there may be periods like now (just a plateau), prices will still hold up pretty well.

The situation on the chain is different. When the tide goes out, the chain can easily experience a 70% drop. Altcoins are not expected to peak at this time as it is not seen how BTC can continue to rise when altcoins “die” nor can BTC peak here.

in conclusion:

• BTC rises, gains more than 2024
• Altcoins are on an upward trend. Although there will be a decline, the intensity will not be as strong as in 2024.

risk

cycle top

We are nowhere near the top of the cycle, but we must continue to reassess on a weekly basis. A cycle top is not necessarily an “event” but more like a range that slowly approaches over time.

Bitcoin Reserve Plan Risks

As a new presidential term begins, all eyes will be on Trump's words and actions. While the positives for Bitcoin are there, it would be quite pessimistic if Trump completely ignored the reserve plan. A more likely scenario is that the reserve plan didn't happen/was delayed by something.

In the latter case: whenever it goes in favor of Bitcoin, it is initially a bearish but ultimately bullish event.

TLDR: Bullish signal = cycle continues. Bearish signal = plans must be revised. The cycle may continue, but the chances are lower.

supply risk

The summer of 2024 saw a crazy macro environment, with stocks hitting new highs. However, as supply giants such as Gox and Grayscale GBTC have been hit hard time and time again, no benefits have been gained, only harm.

Supply risks can never be mitigated. There is always someone with a lot of Bitcoin - the UK government, Silk Road, FTX Distribution, etc. It's just something you have to keep an eye on, but if all goes well, these events are good bargain-hunting events.

Macro risk

Expected rate cuts are smaller, and while less optimistic, the reality is that as long as interest rates continue to fall, liquidity will improve. Again, bullish signal = cycle continues. Barring a rate hike/no rate cut, the macro should be positive for digital assets.

The bearish signal is that inflation is picking up again and the Fed may have to raise interest rates to reduce inflation.

Token recommendation

1.AI

There have been several waves so far. The next wave is expected to arrive soon. Buying and holding won't end well. Goat, the coin that started it all, is down 60% from its highs and will likely continue to underperform.

Top picks: Applied Technologies/Swarms/Gaming/Consumer-Centric AI

ALCH (game development), Griffin (agent that helps control wallets), Digimon, Ai16z, etc. are top choices.

2. DeFi

DeFi will continue to be a great narrative, however it is very difficult to invest in because few tokens will benefit from it, and even if they do, they may not surge.

Frankly, DeFi is not the first choice in terms of risk reward.

Preferred: AAVE/ENA/Morpho/Euler/USUAL

Second choice: Stablecoins/payment-related tokens

3. L1

L1 will make a comeback. The obvious one is Hype. L1 itself is something that the market has been ignoring - it's one of those areas that no one is paying attention to, but holds huge opportunities (as seen with Hype growing 10x).

Top pick: SUI/Hype

Second choice: Abstract

4. NFT tokens and game tokens

The NFT token space is one to watch. PENGU is slowly picking up, Azuki has ANIME tokens, Doodles has...whatever it is. NFTs are not expected to have a renaissance, but their tokens will. Additionally, it’s fun to dig deeper and find interesting games that are about to launch tokens.

Top picks: Pengu / Anime (Azuki) / Spellborne / Treeverse

Second pick: Prime/Off the grid (if the token launches)/Overworld

5. Other narratives

• Data Token: Kaito/Arkm
• Meme: PEPE
• DePIN:PEAQ/HNT
• Ordinals
• Old DeFi: CRV/CVX

2025 Forecast

1. DePIN will be implemented by a company in some way, perhaps an acquisition.
2. Binance will lose market share as the largest exchange. Not from Hyperliquid, but Bybit/OKX
3. As VR makes new strides, Metaverse tokens gain new life
4. ICO is great again
5. The ETH on-chain copycat season will not happen
6. Sui reaches double digits (minimum $10)
7. Ethereum ETF staking approved, leading to more yield products for staking other tokens, as well as yield aggregators
8. A major artist uses NFTs and tokens to maintain and reward fans
9. Bitcoin hits $200,000
10. More CEOs/founders of L1 organizations left their original companies after seeing the resignation of Aptos Labs CEO ( PANews Note: On December 20 , Aptos Labs co-founder Mo Shaikh resigned as CEO, and co-founder Avery Ching will take over )
11. Base fails in competition with L1s and another L1 takes over. Solana keeps it up

Related reading: 2024 Bitcoin year-end review: The currency price rose by 131%, which was less than last year, and TVL surged 21 times to exceed US$6.7 billion.