It’s been half a year since our crypto news update in March, and the crypto world has been incredibly active. While the earlier part of the year was devoted to trying to come out of a pricing skid, the market has rebounded and reached impressive new heights. Bitcoin peaked at around $123K in August – its highest valuation ever. Institutional capital flows are coming in, infrastructure improvements are underway, and regulatory authorities are considering clearer rules in jurisdictions around the world. It’s time for a look at trends occurring throughout the year, product innovations on the horizon, and expectations for the next quarter and year ahead.
Mid-Year Market Performance: Recovery and Reinvention
This year, all eyes were on the aggregate market as it tumbled, found its footing, and then surged to sky-high valuations. The leaders were Bitcoin and Ethereum, as well as ETF-powered capital flow. The global crypto market as a whole rose through Q2 and ended the quarter materially higher than the year’s earlier lows. Demand for crypto is clearly resilient, notwithstanding the drawdowns and turbulence of the spring. Spot-BTC ETFs were a major part of that lift, and crypto index trading revealed the strength of investor belief in digital currency across the board.
One thing to keep an eye on is market concentration. While there are thousands of coins out there, Bitcoin is still the most held and traded on most days. USDT (Tether) and Ethereum also move tremendous volumes, of course, routinely on the order of tens of billions of dollars in value. Regulated venues and ETF wrappers shift the markets, rather than CEX (centralized exchange) spot volume alone. Taken together, this reveals bullish tendencies from institutions, but it means that investors will experience more volatility around ETF flows and macro shocks.
Memecoins Are Back and Better Than Before
Memecoins aren’t a joke or a creature of social media. They are a market niche that investors can take seriously and earn profits from. Summer offered a few themes for attentive crypto fans:
The first is that classic memecoins, like Dogecoin or PEPE, will sometimes see revivals tied to celebrity or other news. When a meme is hot, speculators will buy it, and there will generally be a pump. The question, as always, is when to sell.
The second theme is that a viral meme can spawn multiple tokens, and developers can differentiate their coins with technological upgrades. This means that memecoins might feature Layer-2 integrations, staking, and NFT/gaming hooks (yes, still). With all this activity, investors are generally more selective, favoring memecoins that have viral momentum, but also concrete product roadmaps. Digital speculators have seen enough thin launches with weak ongoing utility.
Tech-savvy businesses can view memecoins as a user-acquisition engine. If blended responsibly with a broader product ecosystem, the result is the conversion of cultural attention into recurring users. Memecoins at their heart are still mostly high-risk, short-cycle plays. There are far more stable assets that the big players in global markets turn to for durable utility.
Evidence of Greater Institutional Adoption by ETFs, Banks, and More
Institutional adoption and interest are some of the biggest forces causing crypto to evolve. The specific trend of the year so far has been spotting Bitcoin ETFs spun up in 2024 and purchased in 2025. These make it easy for large capital flows to bring attention to cryptocurrency. As a byproduct of this interest, there’s now demand for custody and settlement services (integral to the functioning of equity markets), which in turn brings greater attention from large financial institutions as they examine their digital asset offerings.
This highlights the moves mainstream financial players are making as they try to find their place in the crypto world. Instead of experimental projects, some are finding that traditional service lines are needed in the digital currency space. For example, US Bancorp is once again offering a custody service for Bitcoin. The reason this is necessary is that when investors use special vehicles to invest in BTC, such as an ETF, some organization must actually hold the coin somewhere in the world. This parallels the functioning of equity markets, where banks act as holding entities to serve as custodians for stock. The takeaway is that institutions are using well known asset-management practices (e.g., auditing, reporting, and custody) to deal with crypto. It’s a good sign for broad adoption.
Regulatory Developments from East to West
The ever-shifting landscape of crypto regulations continues to move the world toward a clearer picture of how to comply with the law when investing in cryptocurrencies of all kinds.
In the US, Congress enacted a federal stablecoin framework that is supposed to offer a clear licensing and reserve regime for stablecoins. You may have heard of it referred to as the “GENIUS Act.” It sets out strict reserve and disclosure requirements for stablecoin issuers and places permitted bank or OCC-supervised entities at the core of issuance and oversight.
At the same time, Congress is considering structuring proposals that will provide helpful functions like reconciling SEC/CFTC jurisdiction issues and codifying where certain token categories sit. The SEC, under new leadership, has also signaled a more active rulemaking agenda. If there is a way to fold crypto into existing capital markets frameworks, that seems preferable to the current administration (rather than focusing on enforcement tools).
In the European Union, leaders working under the Markets in Crypto-Assets framework (MiCA) are handling the details of supervision regimes, compliance reporting, and tailoring of market-abuse rules for token markets. As with other jurisdictions, regulatory certainty will attract service providers and token issuers to anchor operations in Europe.
In Asia, many regimes are taking shape:
- Hong Kong established a new, specific licensing program for fiat-referenced stablecoins. This includes stronger KYC/AML controls.
- Singapore is clarifying token and payment rules.
- Japan is moving toward tighter oversight of token listings and market conduct.
Overall, regulators are working more on active stewardship and less on the blanket bans sparked by earlier fears of unruly crypto technology.
Stablecoins Will Serve As (Experimental) Infrastructure for the Financial System
Stablecoins are not just niche trading utilities. They are now firmly included in the payments infrastructure conversation. Firm legal frameworks in key jurisdictions are helping fuel issuance at scale. Of course, new entrants are still exploring specialized niches. For example, there are Treasury-backed working-capital tokens, programmable corporate payment coins, and cross-border payroll pilots all in the works or already deployed.
The U.S. federal law that passed this year, however, requires strong transparency and a 100% reserve backing if a stable coin will be a “permitted” payment. The practical impact? Economics have already changed for issuers (e.g., yield payments are limited and interest income is channeled toward authorized custodial models).
Investors will see more tokenized payment pilots with banks and card networks, merchant experiments in stablecoin checkout, and tokenized Treasury instruments used as reserves. The business implication is straightforward: regulated stablecoins are becoming acceptable to treasuries, cross-border settlement, and quick liquidity between crypto and fiat.
New Developments in Web3, Gaming, and Tokenization
Innovations and experiments have given way to an increasing number of straightforward, practical products this year.
Web3 & Gaming
Earlier, crypto games were “play-to-earn,” and these games still hold the attention of many users. The standout 2025 trend, however, is that developers are turning to quality over gimmicks. Studios and publishers are still integrating tokenized assets (like NFTs and on-chain items), but these aim to deliver real player value in the form of interoperable ownership, secondary marketplaces, and verifiable scarcity. Dapp and GameFi trackers show ongoing engagement in the top titles and a growing developer ecosystem.
Tokenization & Real-World Assets
Theories and pilot projects have now turned into launched products in the niche of using crypto tech to hold ownership of hard assets. Developers now offer tokenized bonds, partial ownership in commercial real estate revenue streams, and even art investments. Nasdaq’s recent filing and public push to make tokenized securities tradable using mainstream markets shows that tokenization is now moving toward integration with big, national financial infrastructure, as opposed to a parallel track. If approved and adopted, tokenization will allow for faster settlement of trades, fractional liquidity for traditionally illiquid assets (e.g., shares of a famous painting), and new distribution paths for investment fund managers. Areas for improvement include identification of trusted custody partners (and best practices for such operatives), clear legal rights attached to tokens, and integration with existing clearing and settlement chains.
What to Watch Heading Into 2026
Watch regulators and understand cross-border differences. Passing laws is only the beginning. The near term (late-2025 into 2026) will be about implementing new guidance and supervisory practices, efficiency of license rollouts, and coordination of partners across borders. For businesses that operate internationally, it isn’t only what new laws exist, but also how regulators interpret them.
Product rollouts in custody, tokenized securities, and stablecoins. The re-entry of large banks into custody and the ongoing ETF flows make custody and sub-custody a competitive industry for commercial firms. Companies that can offer strong operational controls, transparent reserve reporting, and integration with administrative practices will be first in line to serve institutional clients.
Tokenization pilot projects hitting scale. Expect more tokenized fund offerings, institutional placements with on-chain settlement, and limited product launches of tokenized corporate debt. Nasdaq’s proposals and large incumbents’ filings mean that there is a serious push behind tokenized securities. These must still be approved and integrated with depositary/clearing partners.
Bitcoin halving in 2028. The anticipated 2028 Bitcoin halving is not an immediate 2026 event, but effects will begin soon. Halvings reduce miner issuance and increase scarcity pressure. Keep it on your calendar if you plan to invest in crypto in the long run.
A note on crypto risks
- Regulatory fragmentation or uneven enforcement. Differences between jurisdictions (tighter KYC in some hubs, more permissive regimes in others) could create patchwork liquidity and compliance friction.
- Concentration risk. ETF and large-holder concentration can amplify flows and cause more abrupt price action when sentiment turns. Modern markets can be incredibly volatile for a variety of reasons, and investors must be ready to react (or avoid reacting).
- Operational & custody incidents. As banks and custodians onboard crypto, they will need to manage any fallout from operational hiccups or security incidents.
- Macroeconomic shocks. Rate, liquidity, and geopolitical shocks remain the principal outside risks that could pull crypto markets down, even in a strong upward part of the cycle.
Summary and Wrap-Up Before Year-End
Since spring 2025, the market has moved from tentative optimism to one where durable infrastructure and regulation are converging with commercial interest in crypto. There are clearer stablecoin rules in major economies, material institutional product flows (spot ETFs) that drive custody demand, growing bank and exchange readiness to offer regulated token services, and a recalibration of Web3/gaming platforms toward product-driven utility.
A lot will come down to commercial execution. Tokenized products are not yet legally equivalent to their legacy counterparts, which is a huge hurdle to overcome. Stablecoins must be demonstrated to pose no unacceptable level of systemic risk. Crypto custody and settlement infrastructure must be made to operate at an institutional scale.
As always, opportunities are robust, and smart investors will find ways to make money in the coming quarter and year ahead.
