Crypto Market Outlook: 5 Things to Watch in 2025

Tl;dr: Our 2025 Crypto Market Outlook is now live. The annual Outlook provides investors with deep dives that span the crypto universe, from altcoins to ETFs, staking to gaming, and much more. Below, we highlight five areas to watch in 2025:

• Stablecoins are crypto’s killer app, and we are fast approaching the day when their primary use case will move beyond trading. 

• While challenges remain, tokenization will emerge as a cornerstone of the current market cycle.

• Potential changes to crypto ETFs, such as allowing in-kind creations and redemptions or staking, could further increase demand.

• Despite facing setbacks in the last cycle, DeFi will be propelled into a new era of innovation. 

• A new regulatory regime that appears poised to make clear, sensible rules will benefit both the crypto industry and consumers. 

Stablecoins are just getting started

Stablecoins have emerged as crypto’s killer app. In 2024, stablecoins’ market capitalization increased 48% to a new all-time high of $193B as of December 1, and some analysts project that this could grow to $3T over the next five years. Year-to-date, they’ve processed over $27T worth of transactions, about 3x more than over the same period in 2023. Stablecoins have delivered proven utility by facilitating faster and cheaper payments on a global scale for a broad range of users, from micro-entrepreneurs to the world’s biggest corporations. As stablecoins continue their surge, we are rapidly approaching the day when their first and primary use cases will be global capital flows and commerce, rather than trading. The tokenization of real-world assets looks set for significant growth

Tokenization continued to make significant progress in 2024, as tokenized real world assets (RWA) grew over 60% to $13.5B (excluding stablecoins) as of December 1, according to rwa.xyz. Firms are experimenting with using tokenized assets as collateral for other financial transactions, like those involving derivatives, which could streamline operations and mitigate risk. Moreover, the RWA trend is expanding beyond assets like US Treasuries and money market funds – finding traction with private credit, commodities, corporate bonds, real estate, and insurance as well.

Although these efforts face their own set of unique challenges, we believe that the cumulative effects of sustained investment and technological refinement in 2025 should set the stage for tokenization to emerge as a cornerstone of the current crypto market cycle. Eventually, we think tokenization can streamline the entire portfolio construction and investing process by bringing it onchain, although this may yet be a few years away.

ETFs have forever changed the supply-demand dynamics for crypto

After the record-breaking success of US spot bitcoin ETFs, the entire crypto market has been transformed. Almost every type of institutional investor – including endowments, pension funds, hedge funds, investment advisors and family offices – now owns crypto ETFs. As institutional adoption continues to increase, we think these holders will provide a long-term, stabilizing source of demand for the asset class.

Looking ahead, the industry is focused on the potential approval of spot ETFs for tokens like XRP, SOL, LTC, and HBAR in the US, but we think meaningful institutional demand may be limited to a small cohort of assets in the near term. Instead, we’re more interested in what could happen if the SEC lifted its mandate on cash rather than in-kind creations and redemptions of ETF shares or allowed these products to incorporate staking. These changes could enhance the potential rewards for ETF holders, help narrow bid-ask spreads, and improve price alignment between share prices and NAV, making the ETFs even more attractive to investors.

DeFi’s resurgence will propel it into a new era

Decentralized finance (DeFi) took some hits in the previous cycle, but a more sustainable and resilient ecosystem has emerged. Lending protocols are hitting all-time highs in total value locked (TVL), while decentralized exchanges (DEXs) are pushing their share of trading volumes – relative to centralized exchanges (CEXs) – to unprecedented levels. Innovative user applications like decentralized physical infrastructure (DePIN) and prediction markets are leveraging DeFi primitives to enable novel experiences. Moreover, the shift in the US regulatory landscape and the adoption of onchain verification could help provide a clear path for traditional institutional investors to participate in DeFi. All of this suggests that DeFi could extend its reach in the near future.

Regulation will finally shift from a headwind to a tailwind

After years of struggling with unclear, inconsistent regulations, the tides have turned and the US will soon usher in the most crypto-friendly Congress ever. A bipartisan, pro-crypto majority in both the House and Senate means that US regulation will provide a tailwind for crypto performance in 2025.

Crypto's emergence as an electoral issue underscores the urgency for policymakers to align with the evolving demands of this influential voting bloc, and we think that the odds of achieving a new legislative milestone are strong. Specifically, we expect to see the establishment of a comprehensive regulatory framework in the US, the introduction of sound stablecoin legislation, and an end to the era of regulation by enforcement. And the US isn’t the only jurisdiction poised to make regulatory progress. Many G20 countries and major financial hubs are writing rules to accommodate digital assets, which should help create more conducive environments for innovation and growth. Taken together, these moves can open the door for more people and institutions to confidently participate in the crypto economy.

A pivotal year

As the regulatory and technological landscapes evolve, we expect to see substantial growth in the crypto ecosystem as wider adoption drives the industry closer to achieving its full potential. The breakthroughs and advancements of 2025 could very well determine the long-term trajectory of the crypto industry for decades to come. This will be a pivotal year. 

 

Now get a USDC loan without selling your bitcoin

TL;DR: Bitcoin-backed loans are rolling out on Coinbase. Customers can instantly borrow USDC at competitive interest rates with flexible, open-ended repayment terms. Loans are powered by Morpho, an open source lending protocol on Base. Crypto-backed loans will launch with bitcoin as collateral, with plans to add more assets in the future. Loans are available to customers starting in the U.S., excluding New York State, with plans to expand to more markets.

Getting a bitcoin-backed loan on Coinbase is now easier and faster than ever. In under a minute, you can get a loan in USDC without ever having to sell your bitcoin. You can earn over 4% in USDC rewards, send USDC globally for free, and use it onchain. You can also convert USDC to USD 1:1 for free to cover major expenses like buying a car or making a downpayment on your mortgage. Borrowing against bitcoin instead of selling it, can help delay a tax gain or loss. Crypto-backed loans on Coinbase are powered by Morpho, an onchain lending protocol built on Base, and grant access to competitive interest rates set by Morpho’s onchain open market lending pool. You no longer have to choose between preserving wealth for the future and spending it today. 

The future of personal finance is onchain

Crypto-backed loans are another major step towards empowering our customers with greater control over their financial lives. Coinbase customers can now get easier, faster access to everyday financial services, leveraging onchain innovation across Coinbase, Base, and the wider cryptoeconomy. They benefit from the transparent, decentralized services enabled by onchain protocols, which can now be accessed through a more seamless, intuitive user experience on Coinbase.

The launch of Coinbase Wrapped Bitcoin (cbBTC) in September gave our customers the ability to move and use their bitcoin onchain. Now, customers can tap into the benefits of cbBTC without having to leave Coinbase. When you borrow USDC against bitcoin, your collateral is automatically converted to cbBTC (1:1) for free and transferred to the Morpho protocol. Combined with the everyday utility of USDC, crypto-backed loans showcase the power of onchain tech to offer vastly improved financial services.  

Getting started is easy

You can now borrow USDC in under a minute. 

• To access crypto-backed loans, go to the Cash tab within your Coinbase app, click on Borrow, and enter the amount of USDC you want to borrow against your BTC. To start, you can borrow up to $100,000 USDC depending on how much bitcoin you have to pledge as collateral. This service will be available on the Coinbase app with plans to roll out to the web browser.

• Once you confirm the amount, the BTC that you choose to pledge as collateral will be converted to cbBTC and transferred onchain to a Morpho smart contract. Morpho will then disburse the USDC loan, which you will see in your Coinbase account within seconds. 

• Interest rates are variable and calculated automatically by Morpho based on market conditions – such that it varies every few seconds with each block creation on the Base blockchain.  

• There is no fixed repayment schedule and users will always have the flexibility to choose when to pay down their loan. 

• If the amount of your loan, including accrued interest, reaches a certain threshold relative to the value of your collateral, liquidations are triggered. You can monitor your loan directly from your Coinbase app

How to Find and Buy New Crypto Before Listing?

How to Find and Buy New Crypto Before Listing? Safer Investing 101

Where to Find New Crypto Projects

So, where do you find these golden crypto opportunities before they hit the mainstream? Let’s dive into some of the most effective avenues.

Social Media Platforms

Social media is an undeniable powerhouse in the crypto industry, with platforms like X (formerly Twitter) buzzing with discussions on upcoming projects. Trending hashtags and crypto influencers can often lead you to the doorstep of the next big new crypto project. It’s a space where news travels fast, and being an active participant can keep you ahead of the game.

Crypto News Websites

Keeping an eye on crypto news websites is another essential strategy. These platforms are often the first to report on promising crypto launches.

However, it’s crucial to approach this information with a discerning eye; not all highlighted projects come from unbiased recommendations. The key is to do your own research (DYOR) to sift through potential bias, especially from paid promotions, ensuring you’re banking on genuine prospects.

Crypto Forums

For those who prefer diving deeper into community discussions, crypto forums like Reddit offer a treasure trove of insights. These platforms host vibrant communities where the latest crypto projects are debated, dissected, and discussed long before they become common knowledge. Participation here can not only alert you to new opportunities but also provide a diverse range of perspectives to consider.

Crypto Launchpads

A launchpad in the cryptocurrency context is a platform designed to support new blockchain projects in their early stages.

Crypto launchpads serve as a bridge between new crypto projects and potential investors, playing a pivotal role in the cryptocurrency ecosystem. These platforms streamline the process of launching new tokens by giving a structured environment for initial exchange offerings (IEOs), initial DEX offerings (IDOs), and launchpools. Each type of pre-launch offering has its unique mechanism, catering to different needs within the crypto community. Don’t let these abbreviations intimidate you — in the following sections, we’ll dive deeper into each type, exploring how they operate and benefit both projects and investors.

Launchpads are not just about fundraising; they also provide crucial advisory support, ensuring that projects have a stronger foundation and a better chance of success. For investors, launchpads reduce the risk associated with investing in new ventures by conducting due diligence and curating high-potential projects. This symbiotic relationship significantly increases the likelihood of project success and investor satisfaction.

Popular Cryptocurrency Launchpads

Among the most popular and trusted cryptocurrency launchpads are Binance Launchpad and PolkaStarter. These platforms have earned their reputation by consistently connecting investors with high-quality projects, contributing to the dynamic growth of the crypto market.

Presales and Airdrops

Finally, presales and airdrops remain popular methods for crypto projects to launch with a bang. They offer a unique opportunity for early supporters to get involved with a project, often with added incentives. Being on the lookout for these events can grant you early access to new tokens before they enter the broader crypto market, allowing you to get in on the ground floor of a potentially successful crypto project. Remember, the key to capitalizing on these opportunities is staying informed and engaged with the crypto community.

How to Buy New Crypto Coins Early

Invest in Crypto Presales

Crypto presales offer investors an opportunity to purchase tokens before they’re available on public exchanges. This process involves connecting a digital wallet to the project’s presale site and exchanging existing cryptocurrency for new tokens. An example of this could be a blockchain project developing a decentralized application (dApp) that opens a presale for its utility token.

However, the presale landscape is fraught with risks, including scams. Conducting thorough research and due diligence is crucial to mitigate these risks and ensure a safe investment.

Participate in ICOs

Initial Coin Offerings (ICOs) serve as a fundraising tool for new projects, allowing them to sell tokens to early investors. To participate in ICOs, one should identify potential projects, apply to join their ICO, and purchase tokens, typically through centralized exchanges.

For instance, Ethereum conducted an initial coin offering in 2014, which is now one of the most notable examples of a successful ICO. However, the ICO space has seen its share of controversies, including significant scams like the one involving OneCoin. Investors are advised to exercise caution and perform extensive research when considering initial coin offerings.

Join IEOs, IDOs, and STOs

IEOs, IDOs, and STOs represent different methods for projects to launch their tokens, catering to various needs within the crypto space:

• IEOs (Initial Exchange Offerings) are managed by crypto exchanges, providing an added layer of security and trust. An example is BitTorrent’s IEO on the Binance Launchpad.
• IDOs (Initial Dex Offerings) take place on decentralized exchanges (DEXs) such as Uniswap or SushiSwap, offering immediate liquidity and broader participation. The DeFi project Compound launching its governance token COMP through an IDO is a case in point.
• STOs (Security Token Offerings) involve tokens backed by real assets, subject to regulatory oversight, like the tokenization of real estate on platforms such as RealT.

Each offering type has its unique advantages, from the regulatory compliance of STOs to the decentralized nature of IDOs and the security of IEOs, benefitting both projects and investors.

Parachain Auction

Parachain auctions are specific to blockchain ecosystems like Polkadot, where projects bid for slots to launch their blockchain connected to the main network (relay chain). Participants lock up tokens (through a crowdloan) to support their chosen project’s bid. Winning a slot allows the project to launch its blockchain, enhancing the ecosystem’s interoperability.

For example, Acala Network secured a slot through a parachain auction, offering contributors rewards for their support.

This model emphasizes community backing and investment in a project’s potential success, showcasing a novel approach to funding and network expansion.

How to Pick Which New Cryptos to Buy: Researching New Crypto Coins

So, you’ve stumbled upon what appears to be a promising cryptocurrency project. However, as we’ve all learned, all that glitters is not gold. Beyond the flashy marketing and persuasive pitches, it’s crucial to delve deeper and see what truly makes a project stand out. Before committing your funds, consider the following key factors to make an informed decision about investing in new crypto projects:

Use Cases

In an increasingly saturated market, a project’s utility becomes its lifeline. Projects that solve real-world problems or offer unique applications within the blockchain ecosystem tend to stand out and maintain value over time. A promising project should clearly articulate how it intends to use blockchain technology to address specific needs or create new opportunities, which are often detailed in white papers.

Roadmap

A roadmap is essentially a project’s blueprint for the future: it outlines key milestones and objectives and details the development and growth plans, including both short-term and long-term goals. A well-structured roadmap demonstrates the project teams’ commitment and provides insights into the project’s potential for sustainability and innovation.

Value

Assessing a project’s value is impossible without understanding what it brings to the table. Does it introduce groundbreaking technology? Does it improve upon existing solutions with efficiency or cost-effectiveness? A project with inherent value is more likely to gain recognition and adoption, contributing to its success as a digital asset.

Tokenomics

Good tokenomics consists of a balanced distribution mechanism, supply limits, and incentives for holders. It’s crucial because it affects how tokens are introduced into the system as well as their long-term value. Look for projects with a clear token distribution strategy that rewards early adopters while ensuring long-term viability, often outlined during the token sale.

Lock-up Period

In simple terms, a lock-up period is when tokens are held and cannot be sold. It’s crucial for investors as it can significantly impact the token’s price once the lock-up period ends. Projects with staggered lock-up periods for team members and early investors tend to provide more stability, preventing market flooding.

Social Virality and Project’s Community Engagement

While traditional finance experts might scoff here, the power of social media channels and community engagement in the crypto world cannot be underestimated. Projects like Dogecoin, Shiba Inu, and others have shown how a strong, engaged community can drive value and adoption. A vibrant community not only supports the project through thick and thin but also helps in spreading the word and attracting new investors.

Liquidity

Liquidity refers to how easily tokens can be bought and sold without affecting their price significantly. High liquidity indicates a healthy, active market, making it easier for investors to enter or exit positions. Projects listed on major exchanges with substantial trading volumes typically offer better liquidity, reducing investment risk.

Read also: How to stay safe in crypto space. 

Why Invest in New Crypto Before Listing?

If you’ve read this far, you’re likely already contemplating the reasons why investing in a new crypto before its listing could be a savvy move. Nonetheless, let’s delve into some compelling motivations that might solidify your decision:

Potential Price Appreciation

The primary allure of early investment in crypto tokens lies in the potential for significant price appreciation. Being among the first to buy into a project allows you to purchase at initial offering prices, which are often much lower than post-listing prices. This early bird advantage can lead to substantial returns as the tokens gain value upon public exchange listing, driven by increased demand and project developments.

High Staking APYs

In the early stages of a crypto project, Annual Percentage Yields (APYs) for staking can be exceptionally high. This is often a strategy employed by new projects to attract investors and secure a loyal user base by rewarding them with higher returns for their early support. Such attractive APYs serve as a nice bonus on top of potential capital gains, incentivizing early participation and investment.

Access to New Features

To enthusiasts and fans of a particular project, early investment can grant exclusive access to new features or services before they become available to the broader public. This access not only allows investors to test and benefit from the latest innovations but also strengthens their connection and commitment to the project’s success.

Purchase Bonuses

Early investment in new crypto tokens often comes with an array of bonuses. These can range from additional token allocations (a.k.a. “airdrops”) to discounted purchase rates or special access rights within the project ecosystem. Such bonuses enhance the value proposition of early investment, offering more than just the potential for price appreciation but also tangible rewards that enrich the overall investment experience.

Final Thoughts

Investing in new cryptocurrencies before they are listed on major crypto exchanges carries its unique set of advantages, from the thrill of uncovering a gem to the financial benefits of early support. While the potential for high returns is compelling, it’s essential to approach each opportunity with a balanced perspective, weighing the rewards against the risks.

 

 XRP price bearish divergence spotted, hinting at a drop to $2.28

XRP's current bearish divergence setup mirrors the technical pattern seen in 2018, which preceded an 80% price correction.

January’s XRP

XRP 

$3.16

price rally risks hitting a point of exhaustion due to an emerging bearish reversal signal.

XRP price chart hints at 25% correction

XRP has surged nearly 50% in January, briefly topping $3.39 on Jan. 18, its highest level in nearly seven years. However, the explosive rally may face headwinds, with technical indicators signaling a potential downside correction of up to 25%.

A key concern is the emergence of a bearish divergence between XRP’s price and its daily Relative Strength Index (RSI). While XRP has been climbing to multi-year highs, the momentum oscillator RSI has trended lower, forming a descending pattern.

This divergence indicates that the upward momentum behind XRP’s rally is weakening, raising the likelihood of a reversal in the coming days or weeks.

XRP/USD daily price chart (Binance). Source: TradingView

Additionally, XRP’s price remains significantly above its 50-day exponential moving average (50-day EMA; the red wave), a key technical support level.

As of Jan. 18, the 50-day EMA sits near $2.28, approximately 25% below XRP’s current price of $3.07. Historically, overextended price rallies tend to revisit their EMA levels as traders lock in profits and the market stabilizes, as shown in the 80% correction following a bearish divergence signal in 2018 below.

XRP/USD daily price chart featuring 2018’s bearish divergence correction.

Moreover, XRP’s latest rally has brought its RSI reading to 66.87, approaching the overbought threshold of 70.

While not yet overbought, the RSI’s declining trend suggests waning buying pressure at current levels, which could amplify selling pressure toward the $2.28 downside target.

Is the XRP bull run over?

As noted above, XRP’s bearish divergence raises the likelihood of a pullback toward $2.28, which aligns with the upper trendline of its prevailing bull flag pattern.

A bull flag pattern forms when the price consolidates inside a downward-sloping parallel channel after a strong uptrend. It typically resolves when the price breaks above the upper trendline and rises by as much as the previous uptrend’s height.

XRP/USD daily price chart. Source: TradingView

XRP has already entered the breakout stage of its bull flag pattern. However, after a breakout, the price often retests the pattern’s upper trendline to confirm it as new support.

Such a retest validates the breakout and provides an entry point for new buyers. A successful bounce from the upper trendline strengthens the bullish case and sets the stage for a move higher toward the original upside target.

In XRP’s case, the bull flag’s upside target is around $4.42, up 40% from current price levels. Additionally, XRP’s long-term outlook remains optimistic, supported by the potential launch of spot XRP exchange-traded funds (ETF) in the US.

JP Morgan analysts predict that these funds may attract $4 billion-to-$8 billion in assets under management.

If the XRP price fails to hold above the flag’s upper trendline, it risks invalidating the bullish setup entirely. In such a scenario, the next downside target could be the pattern’s lower trendline near $1.90, a level that prevented XRP's downside in December.

XRP/USD daily price chart. Source: TradingView

A break below $1.90 would shift the trend decisively bearish, opening the door to deeper declines, potentially toward the 200-day EMA (the blue wave) near $1.35.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Crypto Rebounds After Inflation

 

Crypto Rebounds After Inflation Cools More Than Expected, Blackrock Launches Canadian Spot Bitcoin ETF, and SEC Ramps Up Legal Actions

Token	Change*	Price**
Bitcoin BTC	+6.97%	$99,800

Ethereum ETH	+2.01%	$3,330.25

XRP	+45.4%	$3.333928

Litecoin LTC	+22.7%	$128.01

Fantom FTM	+19%	$0.7952

*Percentages reflect trends over the past seven days.
**Crypto prices as of Thursday, January 16, 2025, at 2:12 pm ET. 

• Core CPI increases less than expected, sparking crypto markets: The closely watched inflation measure increased 3.2% year-over-year in December, less than the consensus 3.3% forecast. Crypto rallied Wednesday after the announcement, with bitcoin, ether, and a number of altcoins all pushing higher.
• XRP continues hot streak: The price of Ripple's XRP surged more than 45% over the past seven days an investors anticipate a new US regulatory regime, an XRP ETF approval later this year and continued momentum following the launch of Ripple's stablecoin.
• BlackRock has launched iShares Spot Bitcoin ETF in Canada via Cboe following the success of its US offering: This move only further solidifies BlackRock's dominance in the crypto ETF market.
• A US appeals court has mandated that the SEC provide explanation for its denial of Coinbase's request for crypto-specific regulations: SEC Chair Gary Gensler is expected to step down next week, but the regulator has continued to proceed with its legal cases against multiple crypto companies.
• SEC files appeal after court rules with Ripple: In a last-ditch effort before Gensler leaves office, the SEC asked a lower court to reverse a decision that ruled Ripple's sale of XRP was not a securities sale.

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CPI Cools in December Ahead of Second Trump Term, Sparking Crypto Markets

The core Consumer Price Index, a closely watched inflation measure, rose 0.2% from the previous month in December and 3.2% year-over-year, according to the US Bureau of Labor Statistics. The crypto markets received the latest inflation data as a positive sign, one that raises the chances of the Federal Reserve setting a more aggressive course for cutting interest rates in 2025. The news comes after last week’s blowout US jobs report put a damper on market sentiment headed into the weekend.

The price of bitcoin surged back above $100,000 on Wednesday following the latest news, a stark reversal after the price dipped below $90,000 earlier in the week. Ethereum also ticked up more than 5%, pushing close to $3,400.

Prior to Wednesday's announcement, crypto markets had remained muted in 2025 while awaiting president-elect Donald Trump to assume office and install a series of pro-crypto initiatives. A Reuters report this week indicated the overhaul could begin as soon as next week. The agenda will reportedly include the SEC clarifying whether they believe cryptocurrencies are a security and reviewing a slough of pending crypto enforcement cases. SEC chair Gary Gensler is expected to formally step down next week, with pro-crypto Paul Atkins succeeding him.

XRP Pushes Higher as Open Interest Increases

Ripple's XRP has continued its ascent in January, with the payments-specific cryptocurrency jumping some 46% over the past week to a price of around $3.29. With the recent surge, XRP has become the third most valuable cryptocurrency by market capitalization, at $176.75 billion.

A more friendly regulatory environment, the launch of Ripple's stablecoin, and the anticipated XRP ETF approval in 2025 have all contributed to driving the price higher. The cryptocurrency's perpetual futures interest market has jumped to $2.34 billion, an all-time high, with leveraged bets around 13%--down from 100% in December. That signals the coin's perps markets is no longer overheated and could be poised for more near-term price gains if traders continue to increase their bets.

The latest price movements come after Ripple has battled regulators for the past few years over a range of issues relating to whether their XRP coin qualified as a security. The anticipated regime change in the US could conceivably allow the company to become more engrained with its institutional client base. Ripple's network is designed to speed up cross-border payments and help the global banking system transfer funds more efficiently.

BlackRock Expands Bitcoin ETF Reach With Canadian Launch

Building on the success of its US launch, BlackRock has introduced iShares Spot Bitcoin ETF to the Canadian market. The newly listed ETF will trade on Cboe Canada under the symbol IBIT, mirroring its US counterpart. This ETF is available in two currency options: Canadian dollars (IBIT) and US dollars (IBIT.U). It can be purchased through a wide range of brokerage platforms, from discount brokers to full-service investment firms. Cboe Canada also facilitates approximately 15% of all trading activity in Canadian-listed securities.

The launch follows a record-breaking debut spot bitcoin ETFs in the US last January. Over the past year, BlackRock’s spot bitcoin ETF has led a wave of popular investment products. The success of spot bitcoin ETFs has been pivotal in bitcoin’s surge to a six-figure price over the last few months, alongside record-high valuations for other cryptos. BlackRock’s expansion into Canada signals further growth for the crypto ETF market as the industry anticipates a promising 2025.

Court Orders SEC to Clarify Coinbase Rulemaking Denial

A US Court of Appeals for the Third Circuit has ordered the SEC to explain its rejection of Coinbase's petition for crypto-specific regulations. This ruling criticizes the SEC’s response as “arbitrary” but falls short of urging the agency to create new rules.

Coinbase originally filed the petition in 2022, seeking clearer regulatory guidance for the crypto industry, but the SEC denied it, arguing that existing securities laws suffice. When the SEC sued Coinbase in 2023 for alleged securities violations, the exchange challenged the SEC’s lack of clear rules.

The court acknowledged the SEC’s right to allocate resources as it sees fit, but insisted on a well-reasoned explanation for its inaction. It also highlighted constitutional concerns, stating that the SEC's vague approach raises due process issues. While the SEC has revised rules like custody requirements for crypto assets, many exchanges have argued these measures are demonstrably unsuitable for digital assets. The SEC is now reviewing the court’s decision to determine its next steps.