January 2025 Crypto Market Analysis: Bitcoin's Dominance Strengthens

In January 2025, the total market value of the crypto market grew by 7.2% to reach $2.8 trillion, with major blockchain platforms showing varied performance. Under the dual impact of new regulatory policies and breakthroughs in artificial intelligence technology, Bitcoin further solidified its dominant position in the market, with its share rising to 71.3%.

Market Overview

The price of Bitcoin rose from $94,577 to $102,180, an increase of 8.0%. In contrast, Ethereum performed poorly, dropping from $3,353 to $3,292, a decrease of 1.8%, with the ETH/BTC ratio hitting a nearly 4-month low.

Several important policy changes have had a significant impact on the crypto market. The new government's cryptocurrency regulatory directives provide unprecedented clarity for the industry, particularly emphasizing the protection of self-custody rights and supporting the development of stablecoins. However, comments at the end of the month regarding international trade tariffs raised concerns about global economic growth, leading to a cooling of market sentiment.

The token launched by the Trump family on Solana has caused a dramatic fluctuation in the meme coin sector. This wave of speculation has diverted market attention and funds from other areas of the crypto market, including the blockchain gaming sector.

DeepSeek's groundbreaking advancements in the field of artificial intelligence have also influenced market dynamics. This progress has accelerated the focus on decentralized AI infrastructure within the crypto ecosystem, with related tokens seeing an increase this month.

Layer 1 Public Chain Analysis

In January 2025, the total market value of blockchain increased by 7.2% to $2.8 trillion, with Bitcoin's market dominance further rising to 71.3%. Ethereum's share continued to decline to 14.0%, while Solana surpassed a certain trading platform's public chain (3.4%) again with a market share of 4.0%. Other public chains collectively accounted for 7.4% of the market share.

Solana continues to perform strongly, with a market capitalization increase of 22.0% to $112.3 billion, solidifying its position as the third largest blockchain by market capitalization.

Among the top 20 chains by market capitalization, Stellar stands out with a significant increase in market capitalization to $12.6 billion, while Litecoin and Monero rose by 23.5% and 21.6%, respectively. Cardano's market capitalization increased by 11.9% to $33.2 billion.

Emerging platforms maintain their momentum, with Sui's market capitalization stabilizing at $12.4 billion in a competitive environment. Although TON's market capitalization dropped by 14.0% to $12 billion, it still maintains its position in the top ten. Hedera has shown good growth, with its market capitalization rising by 14.2% to $11.7 billion.

Traditional Layer 1 platforms such as Polkadot, Near, and Aptos are under pressure, with market capitalization declining by between 3.7% and 7.5%.

Bitcoin Layer 2 and Sidechains

In January 2025, Bitcoin Layer 2 and sidechains maintained a growth trend, with a total locked value reaching 2.6 billion dollars, an increase of 5.2% compared to December.

Core maintains market leadership with a TVL of $660 million, despite a 9.3% drop from December, still accounting for 25.3% of the market share. Bitlayer shows strong growth, with TVL rising 15.2% to $430 million (market share 16.8%), while BSquared performs excellently, with TVL surging 19.7% to $400 million (market share 15.3%).

Rootstock and BOB ranked fourth and fifth with a TVL of 250 million and 240 million respectively, with growth rates of 10.8% and 8.9%. Notably, AILayer's TVL grew by 13.2% to 230 million.

On medium-sized platforms, MerlinTVL saw a moderate decline of 3.7% to $170 million, while Stacks maintained steady growth, rising 4.0% to $120 million. Small platforms showed mixed performance, with BounceBit growing by 7.3%, while newcomers like SatoshiVM and Naka fell by 11.6% and 14.9%, respectively.

Ethereum Layer 2

In January 2025, the Ethereum Layer 2 ecosystem underwent significant changes, with total locked value dropping to $18.3 billion, a decrease of 6.7% compared to December. The performance of market leaders has diverged.

Although a certain Layer 2 platform has significantly dropped by 20.4% compared to December, it maintains its leading position with a TVL of $6.8 billion. Base continues its strong momentum, with a TVL growth of 14.0% to $4.6 billion, solidifying its second position. Optimism remains in third place with a TVL of $3 billion, only slightly down by 0.5%.

Among the best-performing platforms, World Chain stood out with a TVL growth of 27.6% to $350 million, while Paradex surged by 50.3% to $37.2 million. ZK Rollups demonstrated resilience, with Starknet and zkSync Era growing by 7.4% and 12.2% respectively, achieving a TVL of $900 million and $610 million.

Some mature platforms are facing challenges, with Blast TVL dropping by 33.8% to $400 million, and Fuel decreasing by 47.3% to $110 million. Linea and Scroll also fell by 5.7% and 5.2%, respectively.

The competitive dynamics of the ecosystem continue to evolve, with Optimistic Rollup and ZK Rollup demonstrating varying degrees of success. As new entrants join the ecosystem, mature platforms focus on consolidating their market position by enhancing functionality and user experience.