Is crypto the future of finance?

Bitcoin is in the big leagues and cryptocurrency could yet transform financial services.

That was the overarching message from the inaugural VanEck Crypto Investor Symposium this week. 

As Matthew Siegel, VanEck head of digital assets research, argued, there is undeniable momentum behind the asset class. 

Global crypto owners have grown every quarter over the last few years, even through the depths of the bear market triggered by the collapse of crypto exchange FTX. Their number could reach 900 million by the end of this year, driven by demand from both the big end of town and those in developing nations.

"Bitcoin is most attractive to the 1 billion consumers who live in countries that have inflation rates above 10% and less trustworthy institutions," said Siegel.

And Bitcoin ETFs, like the VanEck Bitcoin ETF, have brought both a legitimacy to the asset, as well as making it available to a new group of investors. 

As Jamie Hannah, VanEck deputy head of investments, pointed out, ETFs are a great fit for Bitcoin and other cryptocurrencies, even if that feels counterintuitive.

For the typical investor, an ETF arguably offers more predictable and transparent fees, as well as better accessibility and security, than trying to buy and hold Bitcoin directly.

But Bitcoin ownership trends show it moving from retail and ETFs to corporates in the form of Bitcoin treasury companies.

290 listed companies now hold Bitcoin, according to VanEck data, and corporate holdings now exceed US$150 billion.

Governments are also slowly coming around, with 10 countries now mining Bitcoin with government resources, including France. 

It means Bitcoin now has a market cap on par with many of the Mag 7 stocks, even if it's dwarfed by other asset classes.

A Merrill Lynch survey found 2 in 3 fund managers hold no crypto, and the average holding was a meagre 0.4%.

It all suggests the digital asset has more room to grow.

If Bitcoin reached half the market cap of gold, that would mean a price of US$500,000.

If, as Siegel suggests, Bitcoin becomes a settlement vehicle for global trade, that figure could be US$3 million. 

On the regulatory side, progress is slow, but building. 

Laura Vidiella del Blanco, VanEck head of investor relations, says it's been a "busy year".

Some key pieces of legislation are at various stages of approval in the US, but likely to pass eventually.

The FIT21 bill, which would clarify the regulatory framework for crypto, is still held up in the Senate, whilst the CLARITY Act, which would give the CFTC a central role in regulating digital assets, is awaiting Senate review. 

Hong Kong and Singapore are on the path to clearer stablecoin frameworks. 

The EU and UK are also firming up their own stablecoin regulation, and the UK is looking at reversing a ban on crypto ETNs and derivatives. 

The killer use case

Beyond Bitcoin, it is actually stablecoins that are truly driving global crypto adoption. A stablecoin is a digital token that is pegged to the price of a government-issued currency, such as the US dollar. A stablecoin isn’t always pegged to the price of a gov issued currency. It can be pegged to anything that is ‘stable’ but it is commonly pegged against fiat currency.

It’s the “killer app of blockchains today”, says Pranav Kanade, VanEck portfolio manager.

190 million people own stablecoins, with potentially 150 million of those using them as a savings tool.

As is often the case, there is a certain western chauvinism to how we view assets like Bitcoin and stablecoins. 

For billions around the world without access to a regulated and trustworthy equities market, or even a stable currency, crypto is something of a salve. For those people, stablecoins offer inflation protection and Bitcoin becomes an investment vehicle.

"The rationale is pretty simple, which is most people in all parts of the world have a fiat currency that they prefer to not save their wealth in," said Kanade. 

3.7% of Turkey's GDP was spent on stablecoins in 2023, as locals try to avoid rampant inflation.

It means stablecoin usage, like the number of crypto holders, continued to grow through the last crypto bear market, despite a lack of regulatory certainty. 

Stablecoin issuers are now the 18th largest holder of US T-bills, says Kanade, ahead of countries like South Korea and Germany, and possibly on the way to eventually becoming the largest holder.

But a lack of access to a stable currency is not the only pain point that stablecoins can solve. 

Access to banking is a prolonged and painful process in much of the developing world. It's why stablecoins may also disrupt global commerce. 

In a complicated trade world, made more complicated by currency wars and tariffs, stablecoins offer a lot less friction for many people. 

Stablecoins can provide cheaper, faster transactions especially on global payments than current legacy systems. 

B2B and B2C e-commerce are the obvious use cases, and could see the overall stablecoin market cap grow from its current US$200 billion into the trillions, according to Kanade.

“The net loser are the banks”, said Kanade. 

Watch a replay of the 2025 VanEck Crypto Investor Symposium here.