How can I evaluate crypto as a potential investment?

As the cryptocurrency landscape matures, 2025 is shaping up to be a pivotal year for regulation, utility-driven innovation, and investor participation. From billion-dollar acquisitions to emerging legislation and evolving portfolio strategies, here’s what you need to know.

Major M&A Activity Signals Growth

Crypto-related mergers and acquisitions are heating up. Coinbase recently acquired Deribit, a crypto options exchange, for $2.9 billion, double what Ripple paid for Hidden Road earlier this year. These deals reflect growing institutional confidence, with some experts predicting we’ll soon see M&A figures surpassing previous bankruptcy losses like those from the FTX collapse.

Stablecoin Legislation and the Role of Big Tech

Stablecoins, particularly USDC and Tether, remain under scrutiny. Circle, the issuer of USDC, has rejected acquisition offers and is pushing forward with IPO plans. At the same time, legislation in progress would restrict big tech firms like Meta, Amazon, and Google from launching their own stablecoins, highlighting lawmakers’ concerns about centralized control of both finance and data.

Tokenization and Blockchain Adoption

The next frontier? Tokenization. From car titles and real estate deeds to trade finance and luxury goods authentication, the use of blockchain technology to represent ownership and verify origin is poised to revolutionize multiple industries. The DTCC has even announced plans to bring $10 trillion worth of assets on-chain within a few years.

Regulation on the Horizon

Momentum is building in Washington. A stablecoin bill may pass the Senate by summer, with broader crypto market structure bills expected next year. New SEC leadership has expressed interest in creating clear guidelines and a potential “safe harbor” period to allow crypto projects time to become decentralized, signaling a more constructive regulatory approach.

How to Evaluate Crypto Investment Options

While meme coins continue to attract attention, long-term crypto investors are prioritizing projects with real-world utility, especially those solving business problems in payments, supply chain, and cross-border finance. Key considerations when evaluating cryptocurrencies include:

• The problem it solves
• The team’s experience
• Tokenomics (e.g., supply caps, lockups)
• Breadth of institutional interest or partnerships

Should Crypto Be in Your Investment Portfolio?

Though still underused by most financial advisors, crypto is gaining traction in diversified portfolios. Many investors allocate a small percentage (e.g., 5%) to crypto, balancing its high-risk, high-reward profile. ETFs for Bitcoin and Ethereum provide simplified access, but emerging funds focus on niche, utility-based crypto assets.

Crypto is evolving past speculation into a legitimate financial sector, driven by technological innovation and maturing regulation. While risks remain, understanding the utility and structure behind a cryptocurrency is essential for anyone considering long-term investment in this space.