a16z's State of Crypto 2025: The $4 Trillion Milestone and What's Next

Podcast: a16z Podcast
Episode: a16z's State of Crypto: The $4 Trillion Milestone and What's Next
Date: November 9, 2025
Host: Robert Hackett
Guests: Darren Matsuoka (Head of Data & Funds Strategy, a16z Crypto), Eddie Lazarin (CTO, a16z Crypto)

Episode Overview

This episode unpacks the findings and themes from a16z Crypto’s 2025 State of Crypto Report, providing a comprehensive snapshot of where crypto stands after hitting a $4 trillion total market cap. With spirited discussion, the group analyzes why industry adoption by institutions has finally materialized, examines the uneven participation of developers, and explores trends such as stablecoins, privacy, regulation, tokenization, and real-world asset migration to chain. The conversation is rich in analogies and context, citing both headwinds—like developer migration to AI—and tailwinds—like regulatory progress and mainstream acceptance. The discussion closes with predictions for crypto's imminent "adulthood" as it turns 18 next year.

Major Themes & Talking Points

1. Crypto at Adolescence: Hitting Mainstream, But Still Growing

• Crypto likened to a 17-year-old: “Just nearing the end of adolescence, starting to step into adulthood, being taken seriously by the other adults in the room, but still plenty of growing up left to do.” — (A, 00:00)
• Released in October 2008, crypto is 17 years old; it “feels exactly like a 17-year-old. Right on the cusp of entering adulthood and really kind of stepping into the world.” — (A, 08:05, 08:41)

2. The Report’s Purpose & Historical Context

• The a16z State of Crypto Report is a yearly attempt to “separate the signal from the noise” and “crystallize a moment in time,” tracking shifts across markets, tech, policy, culture, and more. (B, 03:25)
• “It's like, take the unevenly distributed future and distribute it more evenly.” — (D, 04:25)

3. Surging Mainstream Adoption and the ‘Perfect Storm’

• “On essentially every front, crypto is mainstreaming. The numbers are becoming clearer, more specific, larger, faster in every dimension.” — (B, 05:24)
• Stablecoins have reached “completely different place…feel totally inevitable now to the mainstream.” (B, 05:24)
• The institutional embrace is real this time: “They're actually building real tech that is going to last in many cases, not in every case…Real tech doesn't always pan out, right? Not every product pans out, but it feels like something they want to follow through.” — (B, 09:45)
• Regulatory climate: “Probably the single starkest qualitative difference between this year and last year is that the regulatory condition has totally inverted. Right. It has gone from near worst-case scenario…to outright jubilee practically.” — (B, 10:43)

4. Market Cycles, Developer Activity & The Price-Innovation Disconnect

• Crypto cycles are marked by waves of developer interest, but in 2025, rapid price appreciation (to $4 trillion) was not matched by a developer surge: “If we were in the peak of crypto summer…we would be seeing a lot more there.” — (B, 11:21)
• “While prices went up—above $4 trillion total market cap—the developers have not kept pace…It's not the traditional developer-driven bull market like we've seen historically.” — (D, 12:44; A, 15:20)
• “Meme coins don’t present a lot of opportunity except maybe a coin flip to make a bunch of money…Whereas stablecoins, network tokens…do.” — (B, 16:14)
• AI continues to attract top talent, but crypto is regaining ground as regulations clarify and the intersection with AI becomes more compelling. (D, 18:01–21:18)

5. Who’s Using Crypto? Hard Numbers and Global Patterns

• Active Users: Estimated 40–70 million unique people use crypto on-chain monthly—a 10m increase over last year (A, 22:05)
• Note: This is “people who are actually kicking transactions on chain”—not just holders; real users/transactors. (B, 23:28)
• User geography bifurcated:
  • Mobile wallet usage/on-chain activity: developing countries (Argentina, Colombia, Pakistan)
  • Web traffic to token pages: developed nations (South Korea, Australia)—indicative of more speculative interest. (A, 26:03)
• The metric ‘monthly active addresses’ saw a decline; the panel cautions against conflating this with actual users due to address reuse and changing behavior (airdrop farming waning). (D, 27:28; A, 28:05; B, 29:06)

6. Bitcoin’s Role & Narrative Renaissance

• Bitcoin store-of-value narrative holds, but “the need for a store of value has increased” even more than the narrative's popularity. (B, 32:55)
• “Gold has had a spectacular last two years…now there's gold and there's digital gold, there's trad gold and there's new gold. Right. And bitcoin has really owned that.” — (B, 33:29)
• Bitcoin now top 10 global asset by market cap.
• Developer interest rising: “Bitcoin has now gotten into the top five in terms of interest and developer activity.” (D, 37:09; 37:28)
  • More experimentation with programmability, e.g., Lightning, BitVM, tokenization.
• Quantum resistance question: Over $750B in bitcoin could be vulnerable to quantum attacks in future; debate on how/when the community will act. (D, 37:53–38:39)

7. Institutionalization: ETPs, DATs, BlackRock, and Real Adoption

• “About 10% of the total token supply [Bitcoin and Ethereum] is held in publicly traded entities.” (A, 39:50)
• BlackRock’s Bitcoin ETF “the most successful launch of any ETP or ETF product ever, period.” (D, 42:03)
• Key Shift: This time, institutional participation is not PR-lab driven, “not just trying to chase the hottest trend,” but represents meaningful commitment and real economic transformation.
  • “If the developments continue…we could see crypto deeply embedded into the financial services that we use every day. And we could see crypto, you know, seriously being used by billions of people around the world.” — (A, 46:49)
• Stripe’s acquisition of Bridge, Robinhood’s L2 and tokenized stocks, Revolut’s bridging and crypto Rails, Morgan Stanley’s on-chain product R&D: these signal real, deep participation even among legacy banks. (D, 47:20–50:38)

8. Stablecoins: From Payments to Global Finance Engine

• Stablecoins drove the year’s growth: “$46 trillion in stablecoin transaction volume…$10 trillion 'adjusted' for economic activity”—rivaling Visa, ACH, and eclipsing PayPal. (D, 51:33–55:25)
• Institutional interest and U.S. debt: “Stablecoins now account…as a category are now a top 20 holder of U.S. treasuries…put ahead of Saudi Arabia, South Korea, Israel, Germany.” (D, 59:21)
  • Over 99% of stablecoins denominated in USD, offering U.S. a tool to sustain dollar dominance globally. (A, 61:08)
• Product market fit for stablecoins is real, with use expanding far beyond trading into remittances and emerging market payments. (B, 56:33–57:25)

9. Privacy: The Coming Non-Negotiable

• Privacy is poised as “a non-negotiable property” as mainstream and institutional payments increase—“a table stakes property they must have” (B, 61:38).
• Most users “take it for granted…they just assume they have a functional level of privacy.”
• Technological and compliance hurdles remain; next-gen protocols like ZK-proofs, Railgun, Zcash, Noir (Aztec), are making advances but still early.
• “As crypto starts to become useful in these other domains where privacy is more important, there will be more demand…Everyone needs to be ready.” (B, 66:33)
• Prediction: In one year, privacy-preserving stablecoin transfers will be <1%, but "three, four years from now it's substantial. Double digits.” (68:01)

10. Tokenization & Real-World Assets (RWA)

• $30B in RWAs now on chain—predominantly “private credit,” but also gold (PAXG) and other asset types.
• “RWAs are the key to the long term success of DeFi…this is the bridge to traditional finance, which…is many trillions of dollars of size in opportunity.” (A, 70:34)
• Benefits: liquidity, 24/7 trading, lower fees, venue independence, and easier management/transfers—a harbinger for further migration.
• BlackRock’s focus on RWA/tokenization sets pace for institutional evolution. (D, 71:49)

11. Perps, Prediction Markets, and Meme Coins

• Meme coins: Here to stay, enabled by extremely cheap, scalable infrastructure—though panel divided on their significance:
  • Lazarin: “From the perspective of the average entrepreneurial person or developer, meme coins don’t present a lot of opportunity except maybe a coin flip to make a bunch of money.”
  • Matsuoka: “The beautiful thing about crypto is…you can build all sorts of different things on it…whether you like them or hate them, I think they're an important part of crypto story.” (A & B, 78:39–80:41)
• Perps: Perp DEXes like Hyperliquid deliver high-leverage, highly liquid speculation tools, now a central crypto speculator product. “Perp DEXes are a really, really highly engineered way to deliver that product.” (B, 85:45)
  • Caution: Leverage is risky—“Leverage is crazy. I think leverage is a great way to lose everything.” (B, 86:01)
• Prediction markets: Now finally scaling after years of fits and starts (Augur, Polymarket)—sports betting and regulatory clarity help fuel growth. “Intersection with sports betting has now become inevitable.” (A, 89:10)

12. Forward-Looking Insights & 2026 Predictions

• Lazarin: Next year will see “all the integrations and promises and applications and wirings together” being tested live, with major bottlenecks being identified—especially user experience and privacy. Predicts significant advances in user-experience-driven payments and agentic (autonomous) finance. (B, 91:01–94:02)
• Matsuoka: Crypto's “18th birthday” will bring “real clear rules and regulations” and mature institutional commitments. Suggests that simply lowering transaction fees isn’t the biggest opportunity; radical new forms of payments and financial innovation are. (A, 94:31–95:50)
• “People come for savings and stay for the network…having custody, programmable, composable assets…those are much larger.” (B, 96:18)

Notable Quotes & Key Moments

• Crypto’s Adolescence:
  "Crypto sure does feel exactly like a 17 year old…starting to step into adulthood…”
  — A (00:00)

• Stablecoins' Ubiquity:
  “Every bank I've ever spoken with wants to talk about stablecoins. Every financial institution and then small companies, merchants, they feel totally inevitable now to the mainstream.”
  — B (00:13)

• Shift in Regulatory Climate:
  “…the regulatory condition has totally inverted. Right. It has gone from near worst-case scenario…to outright jubilee practically.”
  — B (10:43)

• Bitcoin’s Store of Value:
  “Now there's gold and there's digital gold…bitcoin has really owned that.”
  — B (33:29)

• Institutional ‘Follow-through’:
  “This time it feels like they're actually building real tech that is going to last in many cases, not in every case. Real tech doesn’t always pan out, right? But it feels like something they want to follow through.”
  — B (09:45)

• Stablecoins & Global Finance:
  “Stablecoins now account…as a category are now a top 20 holder of U.S. treasuries…That's absolutely wild that there is this pent up demand.”
  — D (59:21)

• Privacy as a Table-Stakes Feature:
  “Institutions…consider privacy a non-negotiable property. It is a table stakes property they must have.”
  — B (61:38)

• Vision of Crypto’s Future:
  “I think the real opportunity for bringing the world on chain, the real opportunity for kind of rebuilding these global payment rails around stablecoins…is the ability to now do things differently…The new opportunities that get unlocked as a result of us kind of rebuilding the financial system, creating, creating this new Internet. That's what I'm excited for.”
  — A (95:50)

Timestamps for Key Segments

• [00:00] – Crypto’s adolescence analogy
• [03:25] – State of Crypto Report’s purpose and context
• [05:24] – Mainstreaming and “perfect storm” for crypto adoption
• [09:23] – Market cycle discussion and current “vibe”
• [10:43] – Regulatory climate’s dramatic improvement
• [12:44] – The price-innovation cycle and developer migration
• [22:05] – User numbers and demographic/geographic distribution
• [26:03] – Detailed geographic usage patterns (developing vs developed countries)
• [32:00] – Bitcoin’s resurgence and developer activity
• [39:50] – Tokenization, digital asset treasuries, ETPs/ETFs
• [42:03] – Institutional product launches (BlackRock ETF Impact)
• [46:49] – The scope of institutional adoption and product launches
• [51:33] – Stablecoin transaction volume
• [59:21] – Stablecoins as US debt holders/top 20 globally
• [61:38] – Privacy and technological/compliance evolution
• [70:34] – Real-world assets, tokenization, financial system migration
• [78:39] – Meme coins, perps, and prediction markets
• [91:01] – 2026 predictions and industry maturation

Final Thoughts

The 2025 State of Crypto Report captures a pivotal inflection point where crypto has moved from fringe to mainstream—a serious economic category, but still facing growing pains and pending challenges. Institutional adoption, regulatory clarity, the rise of stablecoins, and surging use cases for tokenization dominate the landscape. Yet, persistent hurdles—developer engagement, privacy, and user experience—remain unresolved. As crypto turns “18” next year, its “adulthood” will be defined not just by further mainstreaming, but by how the ecosystem solves for privacy, leverages institutional integrations, and begins to invent and deploy financial products that could not exist before.

To explore the data further, visit:
2025 State of Crypto Data Dashboard

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