The four major turning points in the 2025 crypto market: from "Trump's dividend" to "panic sell-off"

Editing and Compilation | Market Observations Based on Original Data

1. The “Trump Storm” at the Beginning of the Year: How Political Expectations Drive Asset Prices

At the start of the year, the US crypto market experienced a strong upward cycle driven by political factors. As the new government took office, market expectations for improved regulatory environments noticeably increased. Several landmark events during this period are worth reviewing:

Bitcoin price broke the $100,000 psychological threshold in January, setting a new high for the year. Meanwhile, Meme coins related to political figures emerged, with TRUMP tokens soaring from an initial valuation of 400-500 million USD to over 8 billion USD within weeks, attracting a large number of participants.

Substantive progress was also made on the regulatory front. Changes in SEC leadership, the advancement of the stablecoin bill(GENIUS), and discussions about establishing a national Bitcoin reserve plan all painted a more favorable policy outlook for the crypto industry. The large-scale airdrop event on Hyperliquid also drew market attention in Q1.

However, this period was also filled with controversy—questions about the compliance nature of politician tokens, exposure of “insider” trading cases, and scandals involving other family-related tokens(MELANIA) all served as reminders that political premiums are a double-edged sword.

2. Mid-term Structural Shifts: From Single Assets to Asset Ecosystems

In April, escalating global trade frictions directly impacted two markets. The stock market plummeted—(NASDAQ dropped over 3.5% in a week)—and the crypto market also experienced significant adjustments—Bitcoin briefly fell to $77,000, and Ethereum dropped to around $1,540, the lowest since October 2023.

But the downturn bred new opportunities. The most notable phenomenon during this period was the explosion of the Digital Asset Treasury(DAT) concept. Starting with Sharplink’s shift to an ETH reserve model, a wave swept through listed companies’ decision-making. By the end of this period, nearly 70 listed or pre-listed companies announced holdings of Ethereum as a strategic reserve asset.

Among the largest:

• A well-known mining company holds 3.86 million ETH
• A financial services firm holds over 860,000 ETH
• Another tech enterprise holds nearly 490,000 ETH

These figures far exceed the Ethereum Foundation’s own holdings of 230,000 ETH, reflecting increased recognition of Ethereum as an asset class by traditional financial institutions. Meanwhile, the stablecoin sector, driven by the listing(IPO of Circle), saw unprecedented mainstream attention for tools like USDT and USDC.

3. The “Tokenization Boom” in the Second Half: From Equity to On-Chain Assets

Starting in July, on-chain tokenization of US stocks became a market focus. Platforms like xStocks launched tokenized versions of blue-chip stocks such as Apple, Tesla, and Nvidia, enabling retail crypto users to conduct cross-asset transactions via blockchain-native interfaces for the first time.

This innovation broke down barriers between traditional finance and crypto—not only emerging crypto platforms are doing this, but even traditional giants like Nasdaq have submitted related applications to the SEC.

Meanwhile, the derivatives sector also showed new vitality. After Hyperliquid, new on-chain perpetual contract exchanges like Aster emerged, offering lower friction costs and higher leverage efficiency, attracting many traders. Innovative projects related to stablecoins(such as Plasma’s high-yield mechanisms) also created a group of “lucky ones”—some users achieved over 900x paper returns from an initial investment of just $1.

4. Year-End “Big Cleanup” and Market Restart

Mid-October’s sharp volatility marked a watershed for the year. Driven by a series of policy expectation shifts, the crypto market experienced its most intense cleansing of the year. Bitcoin dropped over 16% in a single day, Ethereum over 22%, and Solana over 31%. Liquidation volumes reached tens of billions of dollars, surpassing any previous adjustment event this year.

But crises also brought opportunities. As the market adage goes, volatility creates opportunities—smart traders capitalized on precise short positions or low-entry points to realize substantial gains.

More importantly, this period saw the valuation of two crypto prediction platforms(Polymarket and Kalshi) soar dramatically. Kalshi received a valuation of $11 billion in its latest funding round, and Polymarket’s recent financing round indicated a valuation in the $12-15 billion range. These platforms gained attention for their excellent performance in predicting US political events, signaling that prediction markets are becoming a mainstream part of the financial ecosystem.

Reflection: Patterns in the Cycle

Looking back at 2025, the crypto market experienced a complete cycle—from policy premiums, structural evolution, innovation emergence, to risk cleansing. Whether it’s Trump policy environmental factors or market-based “TACO”(Trump Always Chicken Out) trading logic, all reflect the deep integration of this market with macro policies and traditional finance.

The future direction will largely depend on US regulatory attitudes and the global economic situation. But one thing is certain: innovations like tokenization, prediction markets, and stablecoins are no longer fringe topics—they are gradually permeating mainstream financial systems and driving transformation. This integration may well be the key point where crypto shifts from a speculative tool to a practical asset.