## 2025 Cryptocurrency Narratives: Which Are Genuine and Which Are Bubble—Dissecting the Market's "Real Talk"

The crypto market has always been driven by narratives. As we move several months into 2025, approximately 20 major narratives are unfolding simultaneously within the industry, some of which are creating real value, while others are inflated solely by investor expectations.

### **Progressing Layer Implementations—RWA, Stablecoins, Perpetual Contracts**

**RWA (Real-World Asset Tokenization) has surpassed the $20 billion mark.** From mere conceptual stages, it has transitioned into a phase where mainstream funds and custodial institutions are actively participating across various platforms. Tokenization projects for stocks, commodities, and real estate are rapidly increasing.

**The stablecoin market has grown to $310 billion**, functioning no longer as speculative assets but as practical infrastructure for foreign currency settlements, credit card circulation, and digital banking. It is becoming the strongest bridge connecting the crypto world and the real world.

**Trading volume of perpetual contracts has exceeded $1 trillion.** On-chain perpetual contract platforms now match the monthly trading volume of centralized exchanges. The derivatives market continues to grow at a scale that overwhelmingly surpasses spot trading.

### **Bitcoin Production and the Fusion of Privacy and AI**

**The rise of BTCFi is noteworthy.** Bitcoin is no longer just a store of value but has begun functioning as productive capital. Billions of BTC are being utilized for staking, yield generation, and as collateral assets. Protocols like Babylon and Lombard are attracting large TVL.

**The need for privacy technology is rapidly increasing.** As institutional investors expand on-chain activities, privacy protection compliant with regulations has become essential. In payments, KYC, and corporate fund flows, balancing transparency and confidentiality has become a new challenge.

**The potential of AI combined with cryptographic technology is immense.** AI is becoming an indispensable tool for data processing, intelligent agent-driven operations, and verifiable computation. The industry scale has reached a level that cannot be ignored.

### **DeFi Shifting Toward Consumer Applications**

DeFi’s TVL continues to hit record highs. For example, Coinbase offering DEX trading and USDC lending through Morpho indicates that DeFi is steadily penetrating the general user base. Emerging consumer-focused applications are rapidly gaining prominence.

### **Areas with High Expectations but Slow Implementation**

**Chain Abstraction:** Smart accounts, intent-based operations, and embedded wallets are "dematerializing" blockchains and significantly improving user experience. However, implementation progress has not kept pace with expectations.

**InfoFi:** Functioning as a refinement hub for data markets and incentive activities, with the evolution toward InfoFi 2.0 possibly approaching. Amid ongoing market uncertainties, its value is being re-evaluated.

**Robot-Related Projects:** Hardware deployment is lagging behind the crypto market cycle, remaining in early infrastructure stages. The gap between ideals and reality is substantial.

**Zero-Knowledge Proofs (ZK):** A core technology, but clarity as an investment target is lacking. The main value will likely accumulate within ecosystems that apply ZK technology at scale.

**Software Infrastructure:** There is steady demand for RPC, indexing, interoperability, and data availability, but competition is extremely fierce. Nonetheless, promising projects may still emerge.

### **Signals Indicating Risks**

**Staking and Re-staking:** Continuous yield compression, penalty risks, and complex operational flows are deterring retail investors. This narrative has been somewhat overheated from the start.

**DePIN (Decentralized Physical Infrastructure):** Ideal DePIN requires integration and cooperation with the real world, but many projects have yet to realize this. Regulatory pressures and the lack of sustainable business models hinder development in this area.

**L1 and L2 Differentiation:** While rollups are establishing themselves as the main scaling solution, growth of new public blockchains is stagnating. Current value distribution is shifting from protocol layers to application layers, liquidity, and ecosystems.

**SocialFi:** Issues related to user retention and product-market fit remain unresolved. Short-term breakthroughs seem unlikely.

### **Domains Showing Clear Signs of Decline**

**GameFi:** The fundamental flaws of the Play-to-Earn model remain uncorrected, and most projects have become "DeFi in disguise" with added complex operational flows.

**NFT:** Market recoveries have been observed multiple times, but without new applications beyond JPEGs and avatars, it will be difficult to escape current hardships. Efforts to integrate into gaming are also stagnating.

**Meme Coins:** Despite the hype of a super cycle, liquidity is gradually shifting toward genuine projects. Market share continues to decline, and individual investors are exhausted from chasing the "next 100x" coin.

**Modular Blockchains:** While an important architecture, the narrative is weak. User interest is low, and investors doubt the existence of clear and sustainable profit effects. Most projects have yet to demonstrate this at present.

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**Conclusion: In 2025, the crypto narratives are increasingly polarized between those in implementation and those still in the realm of ideals.** The gap between "areas already proven by numbers," such as RWA, stablecoins, and perpetual contracts, and "areas with high expectations but delayed implementation," like chain abstraction and DePIN, is widening. When making investment decisions, it is crucial to objectively assess "actual market size and growth rate" rather than being swayed by the allure of the narrative.