Maturation of the On-Chain Ecosystem
A recent analysis from Reown indicates that the on-chain ecosystem is evolving, with users increasingly diversifying their activities beyond simple trading. There is a growing consensus that both payment solutions and artificial intelligence (AI) will play significant roles in enhancing the mainstream adoption of on-chain technology. However, several challenges, such as transaction fees, security vulnerabilities, and interoperability issues, remain hurdles to overcome.
Insights on the Future of Crypto Adoption
Reown has released its report titled “The State of Onchain UX” in partnership with BeInCrypto. This report is based on a survey conducted among 1,038 active cryptocurrency users across the United States and the United Kingdom from February 19 to February 26, 2025. The results reveal that 37% of participants believe that payment methods, particularly through stablecoins and remittances, will be critical for achieving mass adoption. Notably, the usage of stablecoins has surged from 20% last year to 37% in the current year. Furthermore, the adoption of crypto wallets is on the rise, with data showing a 1.27 fold increase in the average number of wallets used globally in 2024. Additionally, 54% of users now utilize cryptocurrency for payments, indicating its growing acceptance in everyday transactions. Mirna Barca, Payments Product Manager at Reown, emphasized that for cryptocurrency payments to gain widespread acceptance, they must provide a user experience comparable to traditional financial technology solutions, allowing transactions to occur seamlessly without requiring users to comprehend the intricacies of blockchain technology.
The Role of AI in Crypto Adoption
AI is recognized as another influential factor in boosting adoption, with 35% of respondents identifying it as a significant driver. Nonetheless, there is a degree of skepticism regarding the synergistic relationship between blockchain and AI development, as only 29% believe these technologies will enhance one another. Furthermore, just 18% perceive cryptocurrency as a facilitator of AI advancements. The report highlights that while trading remains the predominant activity among users, payments and AI are viewed as future focal points that could reshape the industry’s landscape, indicating a divergence between current user engagement and their expectations for long-term value.
Key Drivers for Widespread Crypto Adoption
Regulatory developments and the concept of tokenization are also seen as potential catalysts for broader adoption, with 26% of users recognizing each as a pivotal influencer. Since the beginning of Donald Trump’s presidency, cryptocurrency regulation has garnered increased attention. The establishment of a crypto task force by the SEC aimed at formulating a clear regulatory framework for digital assets highlights this focus. The new SEC chairman, Paul Atkins, has also underscored the importance of regulatory clarity, labeling it a top priority. This emphasis has fostered a positive outlook in the industry, with 86% of users believing that regulatory clarity will promote mainstream adoption, while only 14% feel it could hinder innovation. Marco Santori, Director of WalletConnect Foundation, noted that the industry is nearing a resolution to regulatory uncertainty in the U.S., while Europe is also progressing with the Markets in Crypto-Assets (MiCA) framework, though uncertainties remain.
Barriers to Mainstream Crypto Adoption
Despite optimism regarding future adoption, users have indicated several areas requiring improvement before widespread acceptance can be realized. Leading the concerns is the demand for enhanced security, with 33% of users viewing it as vital for broader acceptance. Additionally, 25% of respondents highlighted the need for stronger privacy and data protection measures. Confidence in on-chain security has seen a notable increase, with 69% of users feeling secure—up from 50.5% the previous year. However, the incidence of phishing attacks has also escalated, rising to 21% from 14.4%. Reown’s CEO, Jess Houlgrave, commented that while the increase in phishing attacks is concerning, the user experience related to security needs further enhancement. He suggested that clarifying transaction signing processes and incorporating fraud protection features could empower users to feel more secure. Currently, 44% of users utilize multiple wallets for added security, an increase from 32.8% in 2024. Furthermore, 18% cite security issues, including hacks and scams, as barriers to engaging with on-chain technology.
Challenges Facing Crypto Adoption
In addition to security concerns, high transaction fees are a deterrent for 39% of users, with 30% believing that reducing fees would encourage greater participation. The necessity for interoperability is also emphasized, with 47% considering it essential, while 18% view a lack of interoperability as a barrier. However, only 14% identified it as a primary concern requiring resolution. The report underscores the importance for developers to prioritize real-world applications that guarantee seamless, secure, and affordable user experiences. It also points out the mismatch between user expectations—centered on payment systems and social applications—and current behaviors, which remain heavily focused on trading activities. “Recognizing and addressing this dynamic will be vital in achieving genuine mainstream adoption,” the report concluded. With 67% of survey participants expressing optimism about the future of cryptocurrency, the on-chain ecosystem is set for expansion. However, resolving issues related to security, fees, and interoperability will be critical in unlocking its full potential and catalyzing the next wave of mainstream participation.
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