Stick to your strengths, and you will be rewarded.
Author: 0xJeff
Translated by: TechFlow
2025 was filled with unprecedented turmoil and change. We welcomed a US president who reportedly supports cryptocurrency and artificial intelligence. However, instead of the expected bull market, 2025 became a year of "slaughter" for the entire industry.
Most altcoins experienced a 80%-99% plunge in 2025.
Bitcoin's market capitalization share returned to 2019-2020 levels (over 60%), outperforming most cryptocurrencies.
Ethereum (ETH) traded at prices similar to 2022.
The altcoin market was highly fragmented (with 40-50 million coins available).
Despite a constant stream of positive news within the industry (such as a clearer regulatory framework, ETF approvals, corporate adoption of blockchain technology, and institutional investment in BTC, ETH, and altcoins), the stock market completely outperformed the crypto market in 2025.
Despite the pain and turmoil, 2025 is still considered by many to be a "year of maturity" for the industry, but it also witnessed a significant exodus of practitioners and investors.
So, for those still holding out in the crypto space, here's the key takeaway before 2026:
Let's dive in ↓
Prediction Markets: A Versatile Trading Tool
Prediction markets emerged as one of the fastest-growing verticals in 2025—weekly notional trading volume reached $3.8 billion for the first time, with Polymarket, Kalshi, and Opinion becoming the dominant platforms.
While the debate continues about whether prediction markets are equivalent to gambling, the U.S. Commodity Futures Trading Commission (CFTC) classifies them as event contracts or binary options based on the outcomes of real-world events. The CFTC's innovation-friendly stance, coupled with increasing market demand for betting/predictions, fueled the rapid growth in prediction market trading volume in 2025.
From a trading tool perspective, prediction markets demonstrate tremendous flexibility. They can be viewed as a more user-experience-optimized options instrument (though still lacking in liquidity).
You can leverage your trades in any market, choosing a "yes/no" directional bet as a hedging tool (by holding a spot position elsewhere), or earn profits and potential airdrop rewards by implementing a delta-neutral strategy (equally distributing "yes/no" shares across the market).
Cash-backed puts and covered call options
These two option strategies are ideal for investors looking to manage their investments more conservatively.
Instead of directly buying or quickly selling altcoins when prices fall, you can generate cash flow by selling call or put options. If the price reaches a target, you can choose to buy or sell your altcoin at a lower price; if the price doesn't reach the target, you'll get your principal back.
This strategy is one of the best ways to generate a high annualized return (APR) for your altcoins or stablecoins.
The only thing to note is that your principal will be locked for a period (usually 3-5 weeks), but you will immediately receive the option premium (premium) when you sell the call or put options.
Narrative fatigue + Equity vs. Token = Return to Fundamentals
The pace of market narrative rotation has accelerated significantly. What used to be a hot topic lasting weeks or even months now only sustains itself for a few days at most.
The crypto community (CT) is shifting from chasing narratives to focusing on genuine fundamentals (such as user numbers, revenue, and growth metrics). The market is more inclined to assess metrics of the real business and clarify the value transfer relationship between the business and the token.
However, this year has witnessed too many chaotic situations in the equity vs. token game, especially in the M&A arena:
Pumpfun acquired Padre (a trading instrument) without fully informing Padre token holders. After the acquisition announcement, PADRE tokens plummeted by 50%-80%, triggering a strong backlash from the community. To quell the Padre community's dissatisfaction, Pumpfun promised to airdrop PUMP tokens based on the pre-acquisition PADRE holding value.
Circle acquired Axelar, but similarly ignored Axelar token holders. Following the acquisition, the AXL token plummeted. This is recent news, and what will happen next remains to be seen, but the community is already furious (which is understandable).
The debate between equity and token holders is escalating, leading us to a deeper issue…
Market Governance Organizations and Ownership Tokens
MetaDAO launched a fair, transparent, and manipulable ICO launch platform characterized by high liquidity, a relatively low fully diluted valuation (FDV) structure, and no venture capital (VC) or private placement allocations. Furthermore, it introduced mechanisms such as performance-based team unlocking and potential fund redemption.
This structure gives token holders true ownership, control, and alignment of interests, effectively addressing issues such as project team exit scams, token dumping, opaque operations, and improper acquisitions.
Colosseum (an independent organization accelerating the Solana ecosystem) recently launched "STAMP" (Simple Token Protocol, Market Protection Mechanism), a new investment contract designed to integrate private venture capital funding with the public MetaDAO ICO, ensuring investor rights and aligning with MetaDAO's on-chain governance.
The MetaDAO model has spawned a new category of "ownership tokens," projects that launch via MetaDAO ICOs. Many launched projects have performed strongly—such as Umbra, Omnipair, and Avici—experiencing high demand during their funding rounds, with their tokens significantly outperforming the market in 2025.
Through the MetaDAO model, token holders gain increased importance, truly wielding a voice and effectively owning the project. Project revenue and fees are no longer channeled to equity holders but directly benefit token holders.
The trend towards market governance organizations and ownership tokens is likely to continue into 2026, intertwining with subsequent trends…
The Rise of Security Tokenization
With on-chain liquidity constrained, market participants are increasingly focusing on fundamentals, revenue, buybacks, and other intrinsic value. Simultaneously, enterprises are adopting stablecoins, and more institutions are investing capital in the crypto space. Recently, tokenized securities have become simpler and more feasible than ever before, especially for regulated institutions.
On December 11, 2025, the security tokenization field saw a significant regulatory breakthrough. The U.S. Securities and Exchange Commission (SEC) issued a No-Action Letter, explicitly stating that it would not take enforcement action against the pilot security tokenization program of DTC, a subsidiary of DTCC (American Depository Trust and Clearing Corporation). The pilot program includes the tokenization of Russell 1000 index constituents, U.S. Treasury bonds, and major ETFs.
This mechanism, during its pilot phase (starting in the second half of 2026 and lasting three years), will facilitate compliant centralized tokenization operations through DTC, channeling activity to regulated infrastructure rather than fully decentralized alternatives.
This means that from 2026 onwards, we will see more security tokenization projects, which also implies increased demand for tokenized stocks, accelerating the convergence between traditional finance (TradFi) and decentralized finance (DeFi).
Consumer-Grade Crypto Products and Perps Become Core of Crypto
In 2025, consumer-grade crypto products and perps became the core hot topics in the crypto industry:
Pumpfun peaked in 2024-2025.
Virtuals adopted a similar model but incorporated a completely new AI-powered intelligent agent narrative.
Zora also made similar attempts in the content token space, with the support of Jesse.
Collectibles, Fantasy Football, and Prediction Markets Gained Popularity in 2025.
These are all consumer-oriented products that provide fun for crypto-natives while also attracting non-crypto users (such as prediction market participants) to earn rewards while having fun.
Crypto itself is like a game, and trading is a form of entertainment. Therefore, novel consumer-grade products that effectively combine both tend to stand out.
Perps also have similar appeal because they allow users to make precise bets on asset price fluctuations.
If you look at key metrics for prediction markets and perpetual contracts, you'll find they both reached all-time highs (ATH) in 2025. These figures seem to be screaming that the product-market fit (PMF) in the crypto space has materialized: prediction markets saw $3.8 billion in weekly notional trading volume, while perpetual contracts boasted a staggering $340 billion in weekly trading volume (a record $1.3 trillion in monthly trading volume).
This is why there's been such a frenzy surrounding platforms like Hyperliquid, Lighter, Aster, Polymarket, and Opinion. Massive activity, huge demand, and massive capital flows directly translate into higher valuations and more airdrop rewards.
Consumer-grade crypto products also hold immense potential, but in 2025, we haven't yet seen truly sustainable consumer-grade crypto products. Sportsdotfun (SDF) has shown strong early-stage growth momentum and is currently raising community funding on Legion and Kraken. While the future of this space remains uncertain, the prospects are currently exciting.
From this, we can learn that if you want to find your edge in this market, you either invest in platforms (such as prediction markets, perpetual contracts, and consumer crypto products) or actively participate in these categories:
Learn how to trade perpetual contracts
Make predictions in prediction markets
Use consumer crypto products
Through these practices, you can better understand the market and find your competitive advantage. Otherwise…
You can become a “storyteller”
That’s right, the Wall Street Journal (WSJ), Silicon Valley, and tech professionals are now embracing the role of “storyteller.” Many startups have opened job postings for “storytellers.”
In the crypto space, this is already commonplace. We have “Yappers,” key opinion leaders (KOLs), and storytellers who have been discussing projects and helping build the crypto community for years (even before Kaito coined the term).
But now, it seems the whole world is realizing the importance of having the right narrative and communicating your brand, product, and positioning in the right way.
However, the role of a storyteller goes far beyond that of a “Yapper.” Currently in the crypto space, many "chatterboxes" simply copy and paste content to "make their presence felt," rather than attempting to truly learn and understand what they're discussing.
This presents an opportunity for those who genuinely understand the industry, possess expertise, or are genuinely curious to learn—whether within the crypto community (CT) or the wider field.
Those skilled at storytelling can ultimately have the freedom to choose by expanding their brand influence: they can choose to develop independently or be "acqui-hire" by startups and projects that align with their brand.
In 2025, we already saw successful examples of this dynamic. For instance, Kalshi recruited prominent figures from the crypto community, while several crypto projects successfully shaped their brand and attracted more users through close partnerships and ambassador programs (such as sharing badges).
If you're a good storyteller, this is your stage!
Key Takeaways:
The crypto market in 2024-2025 was like playing Monopoly;
2026 will be more of a stage for corporations, startups, and suited financiers—less Monopoly-like gameplay, fewer easy money opportunities, and less of the narrative of simply "numerical growth."
The future will focus more on fundamentals, alignment of interests, value accumulation, and the leverage of compounding. If you can't cultivate a genuine competitive advantage, even if you're an OG (Original Gamer), you might end up being someone else's "bagholder."
Your competitive advantage can be any of the following:
A clear mind, not blinded by wishful thinking;
A good storyteller;
Creating high-quality products that people truly need;
Trend insight;
Rational trading, not swayed by emotions.
Persist, find your strengths, and you will be rewarded.
Thank you very much for reading! If you'd like to see my thoughts on some projects and more straightforward ideas, check out my "The After Hour" column on Substack.
Disclaimer: This article is for informational and entertainment purposes only. The views expressed herein are not investment advice or recommendations. Readers who receive this article should conduct due diligence based on their own financial situation, investment objectives, and risk tolerance (not covered in this article) before investing. This article does not constitute an offer or invitation to buy or sell the assets mentioned herein.