Stablecoin Transactions Surpass Visa in Q1, Says Bitwise
Despite regulatory wins and a pro-crypto White House, crypto markets stumbled in early 2025.
According to Bitwise Asset Management’s latest Crypto Market Review for Q1 2025, stablecoins were used for more transactions in the first quarter than Visa—a major milestone for the digital asset space.
Bitwise, a leading crypto investment firm known for its index funds, described Q1 as “the best worst quarter in crypto’s history,” highlighting a sharp disconnect between growing adoption and falling prices.
A Regulatory Win, Market Loss
Bitwise CIO Matt Hougan pointed out that politically and regulatorily, Q1 was one of the most positive quarters in crypto’s history. A newly elected, pro-crypto U.S. president made digital assets—especially stablecoins—a national priority, and the SEC dropped several major lawsuits against crypto firms.
Yet despite this favorable backdrop, crypto prices dropped sharply after an initial post-election rally.
“It’s fair to ask: What happens next?” Hougan said. “Will improving fundamentals lift crypto to new all-time highs, or is all the good news already priced in?”
Stablecoin Use Hits New Highs
One of the quarter’s standout statistics: Stablecoin transaction volume edged out Visa’s global payment volume—a major benchmark in the ongoing shift toward digital finance.
Transaction volume for stablecoins jumped over 30%, while assets under management (AUM) surged 13.5% quarter-over-quarter to reach a record $218 billion. As of now, stablecoin market capitalization has grown to $237 billion.
“However big you think stablecoin AUM will get, you’re probably thinking too small,” Hougan said on X. “So the question becomes: What does the rest of the crypto market look like if stablecoin AUM hits the trillions?”
Tokenized Real-World Assets on the Rise
The report also highlighted rapid growth in tokenized real-world assets (RWA), including U.S. Treasuries. The total market value of tokenized RWAs rose from $14 billion to $19 billion in Q1—more than double the figure from the same period last year.
In particular, tokenized U.S. Treasuries jumped from just over $2 billion in Q4 2024 to nearly $4.5 billion this quarter, showing rising institutional interest.
DeFi Makes a Comeback
Venture capital funding in crypto accelerated, with Q1 seeing the second-highest investment into DeFi projects since Q1 2022.
Two of the largest funding rounds of the quarter were DeFi-focused: World Liberty Financial, a project linked to the Trump family, raised $590 million, while Ethena brought in $100 million to develop synthetic, yield-generating stablecoins.
In total:
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DeFi projects captured 18% of VC funding
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Crypto financial services led with 58%
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Infrastructure projects also received 18%
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Tokenization projects accounted for 5%
Despite falling prices, the data shows strong momentum in stablecoin usage, institutional adoption, and DeFi investment—signs that the foundation for the next crypto phase may already be taking shape.
Featured image from: bitcoinke.com