Treasury management transformation: B2B digital money penetration - treasury operations are being reshaped by digital/programmable money solutions such as stablecoins and tokenised deposits. The expected US regulatory clarity and the overall sentiment shift will increase the number of corporate treasuries that take advantage of the efficiencies in payments, primarily by using digital/programmable money. In particular are those that are multinationals and businesses, based in emerging markets but dealing with supply chains or B2B customers abroad.
Expanding tokenisation across industries - the adoption of digital assets is anticipated to grow across various sectors. Corporations are expected to increasingly leverage tokens for payments whilst the tokenisation of real-world assets (RWAs) continues to expand. In the energy sector, tokenisation is set to revolutionise operations by enabling peer-to-peer energy sharing, decentralised grid management and improved energy efficiency through the integration of smart contracts and IoT technologies.
Issuance of institutional native collateral will skyrocket: the BUIDLing of financial markets - the tokenisation of real-world assets (RWA) is set to revolutionise capital markets as it will allow institutional players to manage their collateral efficiently. Currently, traditional collateral settles T+1 in the best case. By BUIDLing collateral, settlement is virtually transforming capital markets to the next level of efficiency. BlackRock's BUIDL fund has brought the tokenised money market fund size to $4B (this market grew 515% in 2024!) We will continue to see the tokenisation of money market funds (MMFs) and other high quality financial assets for the purpose of using them as collateral. We have started to witness the tokenisation gold and other commodities and we will see high grade corporate debt and private debt also being increasingly tokenised. $9B of private credit, $1B of commodities and $111M of public debt have already been tokenised; tokenised MMFs and private credit will easily double.
Continued expansion of decentralised finance (DeFi) platforms – there will be growth of next-generation finance, offering innovative tools such as decentralised insurance, prediction markets and advanced investment options. Traditional banks and financial institutions are set to collaborate with DeFi technology, creating hybrid systems that blend traditional banking with decentralised solutions whereby making finance more accessible and adaptable for everyone.
UK to allow digital asset ETFs - in 2021, the UK FCA banned the sale of ETFs that had invested in cryptocurrencies - there is now over $130billion in ETFs exposed to Bitcoin and $9+billion invested in Ethereum. Expect to see more ETFs offering exposure to other large cap cryptos as well as the UK regulators allowing ETFs that hold cryptos to be made available to investors in the UK.
Transforming energy sharing with tokenisation - during 2025, tokenisation will play a transformative role in energy sharing. It will simplify the exchange of green energy credits and carbon offsets, enabling transparent trading and real-time tracking of renewable energy sources. Tokenisation will enhance efficiency through smart contracts and IoT integration whilst fractional ownership of energy projects will lower investment barriers, empowering energy communities. Additionally, token-based crowdfunding will improve accessibility so making it easier for small-scale investors to support renewable initiatives such as wind and solar energy.
Increase in fund tokenisation - We will see more money market funds being tokenised (this asset class is already worth more than $10trillion). We are likely to see illiquid funds such as infrastructure, private credit and private equity funds being tokenised, thus making these types of funds available for smaller investors and increasing liquidity for these asset classes.
More bonds to be tokenised - S&P has reported that $7.1trillion of bonds were issued in 2024, which is 18% higher than 2023. If CashLink is correct and the cost of issuing tokenised bonds is as much as 1.2% of the value of the actual bond (if just 10% of bonds were issued in a tokenised format), then the savings could be over $85billion - little wonder governments are looking at issuing digital bonds and gilts. In 2025, one country is likely to start issuing its government debt natively on a blockchain.
Money market funds’ assets to challenge bank deposits - 2024 saw a rise of over 15% (according to Fitch rating) and, as companies are able to access funds the same day, it becomes increasingly easy to be able to access some of the world’s most talented treasury managers via money market funds. Not only will investors be able to enjoy better diversification compared to leaving deposits in a bank account, but also some asset managers claim they can calculate interest hourly - which is a lot better than being paid every six months. The downside is, as more money is withdrawn from banks, there is less for them to lend as this is the basis of fractional banking. If commercial banks have fewer deposits, they may charge lenders more which could impact on economic growth.
Additional CDBCs to be announced - we may well see the US announce plans to launch a FED-backed CBDC to rival over a US-based CBDC. So, in order to gain adoption, will the US government restrict the interest it pays companies that offer stablecoins and hold US treasuries as part of its reserves?
US to try and take a lead on digital assets - Trump seems passionate about making the US the centre of digital assets and has now appointed David Sacks, the ex-COO of PayPal and long-time friend of Elon Musk, as the AI & Crypto Czar. Expect to see greater regulatory clarity encouraging firms to go to America and invest in digital asset and blockchain-related business. Silicon Valley is currently awash with cash and historically had not been that much of an influence in the digital asset space, but this could change very quickly as more and more asset classes are tokenised and then managed by AI-driven bots.
US strategic as a Bitcoin reserve – The on-line prediction platform Polymarkets currently its users are betting that there is a 30% chance that the US will establish a BTC reserve fund. US Senator, Cynthia Lummis, has proposed the BITCOIN Act to create a strategic Bitcoin reserve to serve as an additional store of value to bolster America’s balance sheet and enable transparent management of Bitcoin holdings for the US government. Some states such as Michigan, Florida and Wisconsin already invest in cryptos or ETFs that hold cryptocurrencies.
AI agents - a growing trend in, and of, themselves. As we see more real-world assets (RWAs) being tokenised, AI agents will increasingly begin to fulfil automation roles to manage portfolios, blockchain tasks and less complex counterparty interactions. This will free up people to think more creatively and tackle bigger issues and processes which will be good both for digital asset adoption and improve productivity. AI agent adoption will happen slowly, but then very quickly, as the benefits are realised on a massive scale.
Blockchain in healthcare - the healthcare sector is typically more than 10% of the GDP of economies and we will see greater deployment of blockchain technology in healthcare as well as digitisation of healthcare data. AI-powered tools will redefine operations in healthcare, education and financial services and become our ‘go to’ life companion and assistant.
Markets in crypto-assets (MiCA) regulation in 2025: tokenisation is poised for a significant transformation. MiCA will provide legal clarity, establish standardised practices and enhance investor protections, creating a foundation for the widespread adoption of tokenised assets. Although smaller issuers may face compliance challenges, the framework is expected to increase institutional participation, improve market liquidity and drive global scalability.
Gaming will evolve beyond entertainment into a dynamic platform for social interaction, education and economic activity - immersive technologies such as AR, VR and the metaverse will create virtual worlds where players collaborate, trade and even earn a living. With blockchain-based assets and NFTs, gaming economies will grow more decentralised, offering players greater ownership and creative agency.
Ongoing digitalisation of our economies - 2025 will see more seamless collaboration between humans and machines, supported by advanced robotics, generative AI and AR/VR interfaces. The future of work will pivot towards skills in creativity, empathy and complex problem-solving, whilst routine tasks become increasingly automated. Universities will struggle to meet the digital workforce skills needs.
The rise of explainable AI (XAI) - with the increasing complexity of AI models (especially those based on deep learning), it has become crucial to address the “black box” nature of these systems which often lack clarity on how decisions are made. Integrating blockchain technology into this framework provides a powerful solution by ensuring data provenance, auditability and accountability in AI systems, ultimately improving trust among users and stakeholders.
The above predictions were based on both our own and the following for their thoughts and suggestions, including: Antony Abel -TPX; Alex Bausch - 2Tokens; Charlie Morris - ByteTree; Dr Jane Thomason; Korby Hayre - House of Block; Phillip Pieper - Swarm; Helen Disney - Unblocked; Efi Pylriou
Once again, we asked an AI platform for its predictions regarding the outlook for the use of blockchain technology over the next twelve months: “By 2025, blockchain is expected to evolve from a niche technology into a foundational infrastructure across industries. Its potential to enhance transparency, reduce costs, and foster innovation will continue to drive adoption, making it a critical component of the digital economy.”
We then asked an AI platform about the outlook for digital assets: “The next twelve months are poised to be transformative for the adoption of digital assets, with several key trends shaping the landscape:
1. Institutional investors are expected to significantly increase their involvement in digital assets as 64% of current digital asset investors plan to increase their allocation, 45% of institutional investors without digital asset allocations expect to enter the market.
2. Real-world asset (RWA) tokenization is set to accelerate and so that tokenized will have $30 billion to $50 billion by the end of 2025. Tokenized money market funds are expected to potentially reach $10 billion.
3. Stablecoins are anticipated to see significant expansion with estimates of a assets reaching $300-$400 billion, as increased integration with Fintech platforms and merchant ecosystems driving their use.
4. CBDCs are likely to see increased adoption over the next 12 months, marking a significant shift in digital currency landscapes, with yield-bearing stablecoins expected to gain traction.
These trends collectively point to a year of substantial growth and maturation for digital assets, driven by institutional adoption, regulatory clarity, technological advancements, and the convergence of traditional and digital finance.”
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This article first appeared in Digital Bytes (7th of January, 2025), a weekly newsletter by Jonny Fry of Team Blockchain.