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

2024 is a milestone year for the crypto industry. The approval of Bitcoin and Ethereum ETFs, a booming bull market, and the influence of the U.S. elections have driven cryptocurrencies to record valuations, increasingly impacting social and political landscapes.

HTX Ventures has supported 28 leading projects and funds exploring new frontiers in the crypto market this year, covering multiple fields such as DeFi, BTCFi, ZK-rollups, modular infrastructure, Layer 1 and Layer 2 solutions, artificial intelligence, SocialFi, and GameFi.

Looking ahead to 2025, HTX Ventures has identified five standout major tracks, including the Bitcoin ecosystem, infrastructure (Infra), Meme, artificial intelligence (AI), and the TON ecosystem. The report provides an in-depth analysis of the current status, challenges, and future opportunities for each track, along with a macroeconomic context and market outlook.

Bitcoin Ecosystem

market dominance

In the past year, Bitcoin's market dominance has increased from 45.27% to 56.81%. Bitcoin spot ETFs have accumulated holdings of 5.3% of the total existing Bitcoin supply, with the number of holdings increasing from 629,900 at the beginning of the year to 1,243,608.

A new market has officially opened, centered around Bitcoin as the core asset, with ETFs and US stocks as the channels for capital inflow. It utilizes US-listed companies represented by MSTR as a vehicle to infinitely absorb dollar liquidity. The necessity for Bitcoin to further develop its ecosystem and improve capital efficiency has become increasingly prominent.

Layer 2

In the past three years, a total of 77 Bitcoin Layer 2 projects have been launched or completed financing. The total locked value of Bitcoin Layer 2, ( TVL ), 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 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, activities on BTC Layer 1 continued to grow steadily. However, the growth momentum in the third quarter failed to sustain.

other Bitcoin infrastructure

With the increasing adoption of Bitcoin, other infrastructures, including interoperability solutions and security layers, have also begun to emerge.

In terms of interoperability, bridging and WBTC are still mainstream. More interoperability solutions, including Xlink, Atomiq, and Auran, are expected to be launched in the coming year.

In terms of security layers, Babylon has developed a secure sharing protocol for Bitcoin, including Bitcoin timestamps and Bitcoin staking. In addition, Nubit, as a key player in the Bitcoin DA field, expands data capacity through Bitcoin, supporting the development of applications, Layer 2, and oracles.

Whether the upgrade in 2025 passes OP_CAT is key.

What can truly change the status quo is OP_CAT. As long as OP_CAT is approved, developers will be able to use native advanced programming languages like sCrypt on the Bitcoin mainnet to achieve fully decentralized and transparent smart contract development. 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, we believe that Bitcoin will experience a further surge in market demand in the next two years.

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.

Layer 1

• Ethereum: Launched EIP-4844, reducing the costs of Layer 2 networks.
• Solana and TRON: Benefiting from the development of Meme Coins and infrastructure projects, on-chain transactions are very active.
• Aptos and Sui: Applications in the GameFi and DeFi sectors are driving active user growth.

Layer 2

• zkSync and StarkNet: Continuous iterative upgrades, significantly enhancing 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

• LayerZero: Connecting over 40 chains, cross-chain transaction volume has significantly increased.
• Cosmos: IBC upgrade, cross-chain performance improved by 50%.

modular public chain

• Celestia: Supports multiple modular execution layers, becoming 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 contracts and expansion capabilities to the Bitcoin network.

Restaking

Restaking has improved capital utilization efficiency and has received good development and market attention this year, with projects like EigenLayer and Satori receiving tens of millions in investment from leading capital.

investment and financing events

Infrastructure still occupies an important position in investment and financing this year. Layer 1, modular public chains, and infrastructure related to the Bitcoin ecosystem have all attracted capital. Layer 1 currently represents the most concentrated technical development and exploration in the crypto field, and this sector will continue to be a focus for development resources and capital in the future.

Meme

Important retail funding entry after the implementation of the encryption loose monetary policy

In 2024, the Meme track has once again become a hotspot in the crypto market. Solana has successfully stimulated the activity and vitality of the ecosystem by vigorously promoting the innovation and development of Meme projects. From Bome and Slerf at the beginning of the year to Pump.fun in the middle of the year, these projects have exhibited strong 'lottery attributes' and attracted widespread attention.

Meme projects have become an important tool for attracting new users to the crypto market due to their simplicity and low entry barrier. The launch of Moonshot allows users to purchase Meme assets using fiat currency, while the post-election political Meme craze provides a strong sense of participation for new players.

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 inflow.

Meme Infrastructure

As the demand for fair issuance among market users continues to strengthen, there has been a high level of market attention and participation in the Meme fair launch track this year. Infrastructure projects such as 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. As of November 2024, it has successfully issued over 40,000 projects to Raydium, with total project revenue exceeding 1.17 million SOL, approximately 200 million USD.

The success of Pump.fun has not been perfectly replicated on other chains, mainly due to the following reasons:

• Solana has become one of the ideal launch platforms for Meme projects due to its low transaction costs and high throughput.
• The Solana community has shown great enthusiasm for new projects, driving the rapid growth of startup Meme projects.
• Other ecosystems like Ethereum face high Gas fee issues, while Meme projects on other high-performance chains like BSC and Avalanche have also performed relatively flat, mainly limited by their community size and lower user stickiness.

In the future, meme projects may show more diversification and practicality trends. The infrastructure may add integrations with other application scenarios such as games, NFTs, and social media in terms of product functionality. As the multi-chain ecosystem gradually improves and actual use cases become richer, meme infrastructure will continuously inject more vitality into the entire sector.

Artificial Intelligence ( AI )

In 2024, the Crypto+AI track has been continuously exploring viable directions, resulting in dozens of AI sub-tracks, including ZK/OPML to help with AI on-chain, AI data crowdsourcing, decentralized computing power leasing, AI data trading, AI gaming, and AI agents.

encryption projects expand attention to capture AI narrative

This year, a large number of blockchain infrastructure and applications have expanded their focus on AI. One of the main examples of traditional encryption projects turning to AI is Near. Since this year, it has encouraged AI to run on open-source protocols on the chain.

Data Annotation/Management

Blockchain technology can effectively address the limitations of data resources. Multiple projects are being launched, such as Kiva, Sapien, Bagel, etc., aimed at improving data sources and incentivizing more efficient data labeling tasks across jurisdictions.

decentralized reasoning and machine learning

Currently, three major fields of verifiable reasoning have emerged, each with its own cost and security trade-offs.

• ZKML: Using zk-SNARKs technology to provide privacy inference for AI models. Giza, Modulus Labs, and EZKL are the main players in this field.
• OPML: Assume that the reasoning result is accurate unless challengers in the network prove it wrong. ORA is a main example of OPML.
• On-chain decentralized reasoning network: Queries are run by a small number of nodes on the chain. Ritual is an example of a decentralized reasoning network.

decentralized GPU

This year, a large number of decentralized GPU networks have been launched on the market, such as IO.net, Grass, Akash, etc. However, due to the lack of uniformity in GPU resources on these networks, and the fact that most high-performance GPUs are not owned by individual consumers, it is expected that centralized GPU providers will still be the main choice for AI developers.

On-chain AI agent

AI agents are deployed on the blockchain, utilizing a token mechanism to incentivize and guide specific behaviors of the agents. Myshell is an example. In the future, AI agents will gradually become the user's steward and assistant, providing users with more comprehensive service execution capabilities.

Coinbase has launched an AI wallet based on the Coinbase MPC wallet, allowing AI agents to easily use the wallet for various transactions. More productized applications are expected to emerge in 2025.

In addition, AI agent networks have also begun to emerge. Theoriq is a key example. It achieves efficient multi-agent operations on the blockchain through a community-governed AI agent market.

TON Ecosystem

TON(The Open Network)The ecosystem relies on Telegram's hundreds of millions of users and strong technical support, gradually establishing a multi-layered blockchain ecosystem, achieving a comprehensive explosion of the ecosystem and market in 2024.

The success of Notcoin

In May 2024, the first project Notcoin was launched. Notcoin is a social click game that can be accessed through Telegram. After its launch, Notcoin received widespread popularity in the crypto market, relying on its simple game mechanics and Telegram's large user base, achieving millions of monthly active users in a short period and listing on major exchanges.

Optimization of Catizen

After Notcoin, Catizen encourages users to start experiencing with small payments by optimizing the gaming experience, such as acceleration features. This zero-barrier or low-cost payment model further expands the user base.

Other Business Models

In the TON ecosystem, Dogs is one of the most popular Meme projects. In addition to gaming and social projects, DeFi is also flourishing in the TON ecosystem. Projects like TonStaker and Ston.fi have made good progress.

However, click-based mini-games essentially remain a model that introduces Web2 users through the expectation of token airdrops and then sells them to exchanges. Currently, TON is