Author: Matt Hougan, Chief Investment Officer of Bitwise; Translated by: 0xjs@Golden Finance

Every year, the Bitwise team comes together to make an annual prediction for the future of cryptocurrency. This process requires hours of discussion, debate, and reflection among a dozen team members. It is one of the most exciting things we do every year.

We’ll release our 2025 predictions on December 10th. Hint: We think 2025 is going to be wild. But before we get to next year’s predictions, it’s worth taking a look back at how 2024 is doing.

Background setting: Looking back to December 2023

First, let's start with the scenario.

We published our 2024 forecast on December 12, 2023. Cryptocurrencies were in a very different position at the time. Bitcoin was trading at $43,750, and anti-crypto rhetoric in Washington, D.C. was intense. Just days before we published our 2024 forecast, JPMorgan Chase CEO Jamie Dimon testified at a congressional hearing that he had always been “vehemently opposed to cryptocurrencies, Bitcoin, et cetera.” Then he said, “If I were the government, I would shut it down.”

The progress made in 2024 is astonishing. Bitcoin is now trading near $100,000, pro-crypto politicians dominate Washington, and Wall Street firms are eagerly developing in the space. But none of this is apparent when we make our annual forecast in December 2023.

Let's see how we do.

2024 Prediction 1: Bitcoin will trade above $80,000, a new all-time high.

Result: Correct

We were right on target. Bitcoin broke $80,000 in November and has continued to rise, currently trading near $100,000. Our thesis at the time — that the approval of a spot Bitcoin ETF and the Bitcoin halving would together drive prices higher — was spot on.

We will announce our 2025 price target next week and add price targets for Ethereum and Solana. Stay tuned.

Prediction 2: The spot Bitcoin ETF will be approved and will be the most successful ETF launch ever.

Result: Correct

This is also a victory. The spot Bitcoin ETF approved in January 2024 has become the most successful ETF launch to date. As of December 1, 2024, the Bitcoin ETF has attracted $31 billion in inflows. The previous record for "most successful ETF launch in history" was the Invesco QQQ Trust (QQQ), which went public in 1999 and attracted $5 billion in assets in its first year. The gold ETF attracted less than $2 billion in funds in its first year. The Bitcoin ETF has seen fund flows of several times that number and is still growing.

Prediction 3: Coinbase will double its revenue and exceed Wall Street expectations (earnings) by at least 10 times.

Result: Correct

It's going to be a close race. Coinbase has $3.1 billion in revenue in 2023 and $4.1 billion in the first three quarters of 2024. Can it reach $6.2 billion by the end of the year? I think so. Q4 was a phenomenal quarter for crypto.

Coinbase remains one of the most fascinating companies in the world and, in our opinion, undervalued. We will also be releasing a series of Coinbase-related predictions next week.

Prediction 4: More funds will be settled using stablecoins than using Visa.

Result: Incorrect

In the first six months of 2024, stablecoins settled $5.1 trillion globally, up sharply from the same period last year. But they have yet to catch up with Visa, which settled $6.5 trillion in the same period. Close, but not yet.

Prediction 5: As Wall Street prepares to tokenize real-world assets, JPMorgan will tokenize a fund and launch it on-chain.

Result: Incorrect

I really hope this dream comes true. It would be a sweet irony to see JPMorgan Chase (whose CEO once raged about Washington “shutting down” cryptocurrencies) tokenize its own funds.

We are so close! Wall Street tokenized funds are a big theme for 2024. BlackRock, Franklin Templeton, Guggenheim, UBS, Societe Generale, and others have taken this step. JPMorgan has invested heavily in tokenization, reinventing its own tokenization platform and calling it the "next generation of financial infrastructure." But the company hasn't actually launched a fund, so we can't claim victory.

Prediction 6: Ethereum revenue will more than double to $5 billion as users flock to crypto applications.

Result: Incorrect

We were off base earlier. Ethereum-based application activity surges in 2024, but revenues are likely to end the year slightly below last year’s $2 billion. Why? Ethereum’s March “Dencun” upgrade cut network fees by 99%. We ultimately think this is good for the network, but the short-term hit to revenues is challenging.

Prediction 7: Taylor Swift will launch NFTs to connect with fans in new ways.

Result: Incorrect

That didn’t happen, but it’s still an area to watch in 2025. Taylor has reportedly been concerned about whether NFTs are securities. If we get more clarity on regulation of NFTs in the coming year, the question may be back on the agenda.

Prediction 8: AI assistants will use cryptocurrencies for online payments, confirming cryptocurrencies as the “native currency of the internet.”

Result: Correct

In July, legendary venture capitalist Marc Andreessen donated $50,000 worth of Bitcoin to an AI bot called Truth Terminal. The bot ultimately helped popularize a meme coin — Goatseus Maximus (GOAT) — currently valued at $674 million. We suspect AI bots will make widespread use of cryptocurrencies and stablecoins in the coming years. While the GOAT experiment was crazy, it provided an amazing proof of concept.

Prediction 9: Over $100 million will be invested in prediction markets as they become the new “killer app” for cryptocurrency.

Result: Correct

Of all our predictions, this is the one I’m most proud of.

In December 2023, few people had heard of Polymarket, a cryptocurrency-based prediction market where users bet on the outcomes of global events. But we were fans of the platform and thought it would take off as the US election approached. And boy were we right: total bets on the platform jumped from $8 million at the time of our prediction to over $500 million at peak levels. Polymarket became a household name in the process. It also proved particularly prescient in the 2024 election.

In our 2025 predictions article, we’ll predict the next breakthrough crypto application.

Prediction 10: A major upgrade to the Ethereum blockchain will bring average transaction costs below $0.01, paving the way for more mainstream use cases.

Result: Correct

I'm going to do the math on this. The average transaction cost on many Ethereum layer 2 networks has dropped by over 90% year-over-year and is currently hovering between $0.01 and $0.02. But it dropped below $0.01 this summer, and I believe we'll reach that level again soon as the underlying technology continues to improve. Sub-cent transactions on major blockchains will change the world.

Additional prediction: By the end of 2024, a quarter of financial advisors will allocate cryptocurrencies to client accounts.

Result: To be determined

Every year, we survey financial advisors to see how many hold crypto in client accounts. In 2023, only 11% said “yes.” The year-end 2024 survey is still in progress, so we don’t know yet if we’ll hit the 25% mark. One potential headwind: Large, large banks like Wells Fargo, UBS, and Merrill Lynch have yet to approve a spot Bitcoin ETF. But we think it’s a matter of when, not if.

in conclusion

So how did we do? Six right, four wrong, and one up in the air. Given how radical our predictions were — Bitcoin price doubling, prediction markets soaring, Ethereum fees dropping 99%, all in a rapidly changing space — we’ll take it.

But one thing is for sure: we will be even more accurate in 2025. Stay tuned.