Venture capital firm Andreessen Horowitz (a16z) has named key sectors within the crypto industry for the upcoming year, highlighting use cases for tokenization and the integration of artificial intelligence with blockchain technology as potential growth drivers.

According to a16z’s report, applications based on AI and running onchain are expected to deliver at least three emerging trends across the industry: wallets powered by AI agents, decentralized autonomous chatbots and proof-of-personhood solutions. The firm sees use cases for decentralized chatbots for social media content and assets management through trusted execution environments:

“Running on a permissionless set of nodes, and coordinated by a consensus protocol, the chatbot could even become the first truly autonomous billion-dollar entity.”

Another upcoming trend predicted for 2025 is tied to stablecoins. Over the past few months, the sector has established a market fit for global remittances, with several companies and protocols launching new stablecoins pegged to the US dollar. Beginning next year, a16z predicts stablecoins will gradually replace daily credit card transactions: 

“Small-/medium-sized businesses with strong brands, captive audiences, and painful payment costs — like restaurants, coffee shops, corner stores — will be the first to switch from credit cards.”

The venture firm manages more than $44 billion in assets and is one of the most active VCs in the Web3 space. Its dedicated crypto arm backs over 100 blockchain startups, including Coinbase, Solana, OpenSea, Near, Worldcoin, and Uniswap.

Related: Stablecoin trading volume surges to $1.8T in November

Tokenization: Government bonds, unconventional assets onchain 

More “unconventional assets” are expected to come onchain in 2025 as infrastructure rails mature, allowing tokenization across different sectors. The VC firm predicts that previously overlooked assets such as biometric data will generate new sources of income. 

“Individuals could tokenize their own biometric data; and then lease the information through smart contracts to companies,” notes the report, adding that medical data collection through decentralized science protocols is already possible, enabling users to profit from previously untapped resources.

Government bonds trading onchain is another prospect for 2025 and beyond. The market for tokens backed by government securities took off in 2024 , supported by institutional adoption of digital assets. Moving ahead, a16z expects governments themselves to explore the benefits of debt issuance onchain: 

“The UK, for instance, is already exploring digital securities through a sandbox at their financial regulatory body, the FCA (Financial Conduct Authority); its HM Treasury/ Exchequer has also signaled its interest in issuing digital gifts.”

Related: Tokenization can transform US markets if Trump clears the way