This summer, the Variant team has been spending time looking ahead to what the rest of 2024 will hold and what we might see heading into 2025. Below, we share a snapshot of what we’re keeping an eye on as we navigate the next wave of crypto development.
What do you think the next year in crypto will hold? We’d love to see your ideas and predictions — share them with us on X (@variantfund) or Warpcast (/variant).
Jesse
Crypto product things I'm excited about for '24-'25 (quick list, not exhaustive):
Mobile becomes the default.
Stablecoin rails get good enough for global fintech adoption, accelerating institutional/regulatory validation.
Surprising formats for prediction markets emerge.
NFTs have another surprising evolution.
The interplay between creator tools/token launchers gets more interesting/safer.
Farcaster channels become wallets/DAOs, do weird/big things.
Telegram leans into mini-apps/wallet/payments.
Frames/blinks find a large-scale social mini-app, validating the “headless” GTM as a way to bootstrap protocol/marketplace liquidity.
Data DAOs/tokenized marketplaces onboard net new users to earning tokens.
For crypto natives, real skin-in-the-game returns to token distributions, resulting in more loyal/engaged users/owners.
Reply to Jesse’s thoughts here.
Crypto infra things I'm excited about for '24-'25 (quick list, not exhaustive):
Institutions start staking.
Chain/wallet abstraction works well enough that users finally get a superior UX (this is the benefit of all the work on scaling/interop/intents, etc).
Modularity matures; second-generation frameworks package integrated-modules that solve fragmentation while maintaining customizability.
ZK has a breakthrough app at the intersection of privacy/offchain-data/onchain action.
Security vulnerabilities become far less common (e.g. in DeFi/interfaces).
Decentralized compute starts to compete on cost AND performance.
MEV market structure matures, optimistically benefiting users.
Reply to Jesse’s thoughts here.
Li
Some developments I think we’ll see in crypto over the next 6 months - year:
Open-source AI turns to crypto for monetization.
Decentralized AI and compute gain steam.
DePIN onboards people to earning their first crypto.
Financialization leading to adverse incentives reaches a tipping point.
Alana
Some of my predictions for crypto in 2024/2025:
Block / CashApp launches a stablecoin.
There’s a third spot ETF, but it’s not what people expect.
PayPal begins to offer a yield-bearing stablecoin (maybe a modification to PYUSD) and it enjoys meaningful adoption in Venmo.
Human verification projects will onboard 100M+
A major talk show host makes an NFT their profile picture.
Farcaster exceeds 3M users and begins to offer meaningful mobile-first distribution.
The breakout AI x Crypto use case is community owned and trained models.
The hype this cycle around decentralized GPU marketplaces turns out to be just that (hype) as supply shortages ease and new types of chips emerge.
We do see an important use case in decentralized training + inference emerge as centralized clouds begin to develop policies around what types of models can run on their servers, but that will take 2+ years to really develop (because regulation is slow)
Building on Bitcoin becomes a dramatically better developer experience.
A well-known traditional finance person writes a thread about Helium (or another depin project).
A popular L2 decides to become its own L1.
At least half of these are wrong.
Reply to Alana’s thoughts here.
Cooper
Some current end-of-year predictions:
Shared sequencers finally launch.
Many proving marketplaces hit testnet.
Rollup FUD quiets as they decentralize.
Ethereum's roadmap gets more clarity.
ZK apps ship to production and actually get used.
Sharding research becomes trendy again.
Reply to Cooper’s thoughts here.
Derek
Meta-level prediction for '24-'25: We transition from the infra to the app portion of this cycle.
Some specific thoughts:
10+ major fintechs launch their own stablecoins.
ETFs begin staking.
A crypto consumer app on Base reaches 10M+ WAU.
Every TradFi megafund tokenizes a product.
A crypto prediction market reaches $1B in monthly volume in a category beyond politics.
BTC is used as a reserve asset for a major global currency.
A top 20 US bank borrows money using DeFi rails.
A DePin network grows to 10M+ users.
A major AAA studio builds an onchain game.
DEX volume surpasses CEX volumes at one point.
A minigame on Telegram/Ton hits 1B players.
Reply to Derek’s thoughts here.
Geoff
12 months from now, I expect there will be much more clarity about what use cases and platforms for agentic AI have PMF in crypto.
Over this period, I think we’ll see several apps get traction and define the first generation of viable use cases. These leading apps will then bootstrap the network effects of agent platforms, influencing which platforms become Schelling points.
The first step in the sequence is building compelling user-facing experiences that leverage agents. Some of the use cases I think are most likely to get early traction:
Token discovery, research, and trading.
Airdrop and yield farming.
Gaming: agents as playable characters and NPCs.
AI companions.
Autonomous content producers.
I’m really excited to see the coming wave of innovation across these and other use cases. It should be a fun time to be a crypto user!
Reply to Geoff’s thoughts here.
Read this next
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Derek Walkush & Jack Gorman: The Future of DEX Trading
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Alana Levin: How to Build a Pitch Deck
According to Alana, “a pitch deck can be a work of art.” You just need to know what goes in it. She believes there are six things every good deck must have. “Everything else can go in the appendix.”
Jake Chervinsky: Biden Gives Democrats a Chance for a Crypto Reset
Jake says President Biden’s decision not to seek reelection could lead to major changes in the crypto regulatory landscape.
Updates from our portfolio
July highlights from the startups we’re proud to invest in
Uniswap Labs released the Uniswap Extension so users can access their wallets from their Google Chrome sidebar.
Morpho became the second-largest lending protocol on Base within one month of launching.
Worldcoin released a developer preview of its new World Chain blockchain.
Blackbird is testing out Pay with Fly at participating restaurants so its members can use crypto to cover their restaurant bills.
Interoperable infrastructure developer Ceramic came out with Ceramic-One, a major update that increases throughput.
Thinking in public
We welcome your input and replies on Warpcast.
Jesse is looking for even more reasons why owning things on the internet is awesome.
Li wants to know why AI agents need crypto.
Geoff wants to know who’s working on stablecoin savings and payments.
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Disclaimer: This post is for general information purposes only. It does not constitute investment advice or a recommendation or solicitation to buy or sell any investment and should not be used in the evaluation of the merits of making any investment decision. It should not be relied upon for accounting, legal or tax advice or investment recommendations. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment. Certain information contained in here has been obtained from third-party sources, including from portfolio companies of funds managed by Variant. While taken from sources believed to be reliable, Variant has not independently verified such information. Variant makes no representations about the enduring accuracy of the information or its appropriateness for a given situation. This post reflects the current opinions of the authors and is not made on behalf of Variant or its Clients and does not necessarily reflect the opinions of Variant, its General Partners, its affiliates, advisors or individuals associated with Variant. The opinions reflected herein are subject to change without being updated.
