After an extraordinary first half of 2025, cryptocurrencies have a lot to live up to in the rest of the year. A mix of factors could play on crypto prices in the coming months, including potential Federal Reserve rate cuts and further progress on the regulation front. However, if the economy slows and consumer sentiment shifts, we could see a more risk-averse environment, and crypto could suffer.
Bitcoin (BTC 4.10%) will almost certainly continue to dominate in the second half of 2025. But any potential boom is more likely to come from cryptocurrencies that will support stablecoin and decentralized finance (DeFi) development, setting the stage for growth this year and beyond. Here are three cryptocurrencies to have on your radar.
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1. Ethereum
Ethereum (ETH 4.72%) seemed overshadowed by Bitcoin in the first half of the year, underperforming while its big brother pushed ever higher. However, the tide turned over the summer. As of Sept. 1, Ethereum had gained 65% during the past three months, significantly outpacing Bitcoin.
CRYPTO: ETH
Key Data Points
One big reason for Ethereum's surge is that it's the top smart contract crypto. Smart contracts are tiny pieces of code that make a blockchain programmable. That means people can build DeFi apps and stablecoins on the Ethereum ecosystem. Shifting regulatory and institutional attitudes mean both areas are ripe for growth, which could translate into more projects and value for the network.
According to DefiLlama, the Ethereum ecosystem already holds about 60% of the money deposited on all DeFi apps. With almost $90 billion in total value locked and more than 1,500 protocols, Ethereum continues to be the DeFi king.
Regulatory clarity has helped Ethereum in another way, too. Until May, some U.S. brokerages were hesitant to offer crypto staking services because the Securities and Exchange Commission (SEC) had suggested the yield payments broke securities laws. Staking is a way to tie up your crypto holdings and earn rewards by contributing to network security.
In May, the SEC said that staked cryptocurrencies were not always securities. This makes it easier for U.S. Ethereum investors to stake their holdings and earn interest. Staking yields are one reason some companies are buying Ethereum to add to their corporate treasuries. Not only that, but in the coming months, the SEC may approve Ethereum exchange-traded funds (ETFs) that pay staking rewards.
Why Ethereum could boom
Increased activity on the ecosystem and staking-led institutional interest could both be major drivers for Ethereum in the second half of the year.
2. Chainlink
Chainlink (LINK 4.38%) is like a bridge between blockchain networks and the real world. It calls itself an "oracle platform," and it works by collating and feeding data into cryptocurrency ecosystems.
That's essential for smart contract cryptocurrencies. Those tiny pieces of code mentioned earlier need triggers to activate them. That's where Chainlink comes in. It makes sure that smart contracts can access accurate information, whether on-chain or in the real world.
For example, if you borrow money on a DeFi platform, the smart contract might manage the interest and lock the collateral. If the value of the collateral falls below a certain level, it might automatically liquidate your holdings.
In the real world, let's say a farmer takes out insurance against certain weather conditions. In a decentralized world, the smart contract would need to know when those conditions were met, as that would trigger an automated insurance payout.
Chainlink is ideally positioned to benefit from a surge in decentralized finance activity and interest in tokenization. In August, it announced a project with the Department of Commerce to bring U.S. economic data on-chain. It's already working with the Swift international payment network, Mastercard, and other major banking players.
Why Chainlink could boom
Stablecoins and tokenized assets are at a turning point, and Chainlink's oracle network may act as the backbone of this emerging market.
3. Solana
Solana (SOL 2.32%) was a new kid on the crypto block during the last crypto bull run, gaining more than 9,000% in 2021. While it isn't going to gain by that magnitude again, it wasn't just a flash-in-the-pan project. The cryptocurrency set a new high at the start of this year after the popular $TRUMP launched on its network. Solana subsequently dropped as the frenzy over political meme coins faded.
Nonetheless, Solana's low fees and fast transaction processing have helped establish it as a serious smart contract cryptocurrency that has already taken market share away from Ethereum. Indeed, Solana has the second-highest amount of value locked on its chain. However, with 7.5% of the total DeFi cash compared with Ethereum's 60%, it still has a way to go.
Why Solana could boom
There's a strong likelihood that the SEC will soon greenlight a spot Solana ETF. Speedy Solana will also benefit from increased demand for staking cryptos and the growth in stablecoins and DeFi.
Crypto rally may not be sustainable
The cryptocurrency market is maturing, but it is still a relatively new industry, with a lot of unknowns. Prices can be extremely sensitive to market sentiment, making it difficult to predict what might happen in the short term. That's one reason to make sure crypto only makes up a small percentage of your wider portfolio.
Global events, technical issues, or high-profile scams could cause prices to dip. Equally, the cryptocurrency market may continue to consolidate gains and establish itself as a slightly more mature asset class without the meteoric gains.
These cryptocurrencies certainly have the potential to outperform in the second half of 2025. More importantly, they are well-positioned to do well in the long term and -- hopefully -- survive another crypto winter. But there are no guarantees, and it's important to be prepared for potential losses as well as gains.
