HTX Ventures 2024 Crypto Market Review and 2025 Outlook: 5 Promising Tracks

The year 2024 is a milestone year for the encryption industry. From the approval of Bitcoin and Ethereum ETFs at the beginning of the year, to the thriving bull market, and then driven by the U.S. elections, cryptocurrencies like Bitcoin have reached record valuations, increasingly influencing social and political landscapes.

Looking ahead, five major tracks show exciting progress in 2024, warranting close attention in 2025. These tracks include the Bitcoin ecosystem, infrastructure ( Infra ), Meme, artificial intelligence ( AI ), and the TON ecosystem.

Bitcoin Ecosystem

market dominance

In the past year, Bitcoin's market dominance has increased from 45.27% to 56.81%. This means that the majority of liquidity in the current crypto market is primarily concentrated in the Bitcoin ecosystem and is continually increasing.

The Bitcoin spot ETF has accumulated 5.3% of the total existing Bitcoin supply, with holdings increasing from 629,900 coins at the beginning of the year to 1,243,608 coins, a growth of 613,708 coins. Within 12 months, the ETF's holding percentage rose from 3.15% to 6.25%.

A new market has officially opened that uses Bitcoin as the core asset, with ETFs and U.S. stocks as channels for capital inflow, leveraging U.S. publicly listed companies represented by MSTR as vehicles to infinitely absorb U.S. dollar liquidity. Therefore, the necessity for Bitcoin to further develop its ecosystem and improve capital utilization efficiency has become increasingly prominent, which will also be achieved by increasing BTC demand and raising prices.

Layer 2

In the past three years, a total of 77 Bitcoin Layer 2 projects have been launched or completed funding. In the first half of 2024, driven by the wave of Bitcoin ETF concepts, the trading volume and token prices of earlier rounds of Bitcoin Layer 2 projects like the Lightning Network, Stacks, and Liquid Network ( have surged significantly. These older Layer 2 projects have also witnessed further technological developments. Various Layer 2 solutions have emerged on Bitcoin, including Spiderchain, ZKRollup, EVM-compatible chains, sidechains, and more. As of now, the total locked value ) TVL ( of Bitcoin Layer 2 has reached 3 billion USD, contributed by 19 projects. Assuming all Bitcoin Layer 2 projects are launched in the coming years, the total TVL is expected to grow by at least 2 to 4 times, reaching 6 billion to 12 billion USD.

) Layer 1/Execution Layer BRC-20, Ordinals, and Runes are the main new execution standards that emerged at the end of 2023. Despite an overall market decline in the second quarter, BTC Layer 1 activity continued to grow steadily. However, while the Bitcoin market saw a rebound in the third quarter, this growth momentum failed to sustain.

other Bitcoin infrastructure

As the utilization of Bitcoin increases, other infrastructures including interoperability solutions and security layers have also begun to emerge.

Bridging and WBTC are still the mainstream interoperability solutions for Bitcoin. Since the Bitcoin network does not directly provide composability for building applications, people have to rely on these bridges/WBTC to unlock DeFi yields on other blockchains. More interoperability solutions, including Xlink, Atomiq, and Auran, are expected to be launched in the coming years.

However, these interoperability solutions may pose a threat to the security of underlying assets, as hacking incidents occur from time to time. In response, security solutions related to Bitcoin have begun to emerge.

Babylon is a typical example. It has developed a secure sharing protocol for Bitcoin, including:

• Bitcoin timestamp: Allows for the recording of data timestamps on the Bitcoin network, enhancing the credibility and immutability of the data.
• Bitcoin Staking: Allows Bitcoin to provide security for other networks through economic incentives.

In addition, with the emergence of new technologies, such as the Data Availability Layer ###DA Layer (, the potential usage value of Bitcoin is further released. Nubit is a key player in the Bitcoin DA field. It expands data capacity through Bitcoin, supporting the development of applications, Layer 2, and oracles.

) Whether the upgrade in 2025 passes OP_CAT is key. The Taproot upgrade has enabled the Bitcoin mainnet to issue assets. From the emergence of BRC-20 inscriptions and the Ordinals NFT market in 2023, to the subsequent launch of asset issuance protocols such as ARC-20 and SRC-20, and the rise of infrastructure like Bitcoin Layer 2, Bitcoin Restaking and LST, and Bitcoin cross-chain bridges, the entire ecosystem has rapidly developed. Subsequently, after the Bitcoin conference in July 2024, the market shifted its focus to native BTCFi that can achieve decentralization and non-wrapped models, such as stablecoins.

Currently, through the cryptographic techniques of cautious log contracts ###DLC( and adapter signatures )Adaptor Signature(, developers can program financial contracts in Bitcoin scripts that depend on external events, ensuring the permissionless nature of stablecoin and lending projects during settlement, and guaranteeing the permissionless nature of multi-party transaction operations through partially signed Bitcoin transactions )PSBT(. However, this still involves game theory logic to some extent, which aims to prevent malicious behavior by project parties by raising the cost of wrongdoing, rather than achieving complete decentralization from the smart contract level. The stablecoin project Shell Finance, which is about to launch its mainnet, adopts this solution.

The one that can truly change the status quo is OP_CAT. As long as OP_CAT is approved, developers will be able to use sCrypt and other Bitcoin native high-level programming languages to achieve fully decentralized and transparent smart contract development on the Bitcoin mainnet. sCrypt is a TypeScript framework for writing smart contracts on Bitcoin, allowing developers to directly use the popular high-level programming language TypeScript to write smart contracts. The current Bitcoin Layer 2 can also be converted to ZK Rollup, and the total scale of BTCFi is expected to increase significantly.

With the dual support of the macro market and infrastructure, Bitcoin will see a further surge in market demand in the next two years.

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Infrastructure)Infra(

In 2024, infrastructure remains one of the most attractive tracks in the encryption industry. The combination of capital and technology has driven the rapid development of projects such as Layer 1, Layer 2, and middleware. The continuous upgrade and construction of the Ethereum ecosystem, as well as the improvement of Layer 2 fees and performance; the rapid development of other high-performance Layer 1s led by Solana; the ongoing deepening of the multi-chain landscape; projects represented by EigenLayer enhancing network security and capital efficiency through the Restaking mechanism; multiple Bitcoin Layer 2 projects attempting to combine Bitcoin's security with high-performance scaling solutions, all of these have promoted the vigorous development in the infrastructure field.

) Layer 1 Layer 1 projects continue to optimize their consensus mechanisms and performance, providing a solid foundation for on-chain applications.

• Ethereum: Launched EIP-4844, reducing fees on Layer 2 networks.
• Solana and TRON: Thanks to the development of Meme Coin and infrastructure projects like Pump.fun and SunPump, on-chain transactions are very active.
• Aptos and Sui: The application in the GameFi and DeFi fields is driving active user growth.

Layer 2

Layer 2 continues to be a key path for scalability, with ZK Rollup and Optimistic Rollup each developing.

• zkSync and StarkNet: Continuous iteration and upgrades, significantly improving the user experience of ZK Rollup.
• Base and Arbitrum: DeFi and NFT projects are thriving on these platforms, with significant growth in TVL.

Layer 0 and cross-chain middleware

Layer 0 and cross-chain middleware have made new breakthroughs in interoperability.

• A certain platform: connects over 40 chains, cross-chain trading volume has increased significantly.
• Cosmos: IBC upgrade, cross-chain performance improved by 50%.

modular public chain

Modular public chains offer high performance and flexibility, attracting a diverse range of applications.

• Celestia: Supports multiple modular execution layers and becomes a benchmark project for modular public chains.
• Monad: Attracts a large number of developers and DApp deployments with ultra-high TPS performance.

Bitcoin Layer 2

Bitcoin Layer 2 has become an emerging hotspot in the primary market this year, with several related projects such as Babylon, Taro, BounceBit, and Corn completing financing this year, mainly bringing smart contract and scaling capabilities to the Bitcoin network.

• Taro: Expanding Bitcoin's payment and contract capabilities through the Lightning Network.
• Stacks and RSK: Driving the growth of Bitcoin smart contract applications.

Restaking

Restaking has improved capital utilization efficiency, and this year it has also received good development and market attention, with projects such as EigenLayer and Satori receiving tens of millions in investments from leading capital.

financing event

Infrastructure continues to play an important role in financing and investment this year. Layer 1, modular public chains, and infrastructure related to the Bitcoin ecosystem have all received capital favor. Layer 1 currently represents the most concentrated technological development and exploration in the encryption field, and this track will remain a focus of development resources and capital in the future.

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Meme

) Important retail funding entry after the implementation of the encryption loose policy In 2024, the Meme track once again became a hotspot in the crypto market. As an ecological stronghold, it not only promotes community consensus but also integrates with fields such as DeFi and GameFi to create new use cases. For example, Solana successfully stimulated the activity and vitality of its ecosystem by vigorously promoting the innovation and development of Meme projects. From the Bome and Slerf at the beginning of the year to Pump.fun in the middle of the year, these projects, with their Bonding Curve pricing model and low market cap opening approach, demonstrated strong "lottery attributes", attracting widespread attention. In addition, the decentralized feature of Pump.fun, "Anyone Can Deploy Meme", has fostered greater ecological prosperity, with over half of the Solana Meme projects originating from Pump.fun, among which dozens of projects have a market value exceeding 1 billion dollars. Public chains like SUI and TRON have also quickly followed the Meme strategy, further invigorating their respective ecosystems.

Meme projects have become an important tool for attracting new users to the crypto market due to their simplicity and low entry barriers. The launch of a certain trading platform allows users to purchase Meme assets with fiat currency, while the post-election wave of politically related Memes provides a strong sense of participation for new players. Looking ahead, the Trump administration's crypto policies and related governance trends will bring potential news impacts to the market and may spark new Meme hotspots. For example, if the "Department of Government Efficiency" ### led by Elon Musk, abbreviated as "DOGE" (, gains attention, it could trigger another surge in Dogecoin.

As the crypto market environment becomes more relaxed, it is expected that more retail investors will enter the market, and Meme projects will become an important channel for capital inflows. The huge price increases observed after a trading platform lists Meme coins fully illustrate this trend, which may continue to drive the development of this sector in the future.

) Meme Infrastructure As the demand for fair issuance among market users continues to grow, this year has seen a high level of market attention and participation in the Meme fair launch track. Infrastructure projects like Pump.fun and SunPump have become leading cash flow projects this year, injecting new momentum into the development of Meme.

Pump.fun

Pump.fun is a meme project issuance platform built on Solana. By providing simple and intuitive creation tools and strong community support, it adopts a fair distribution model and has designed a mechanism for automatically adding liquidity to DEX. Coupled with Solana's successful market operations, community operations, and low transaction costs, Pump.fun is a