Stanford University has identified three defining challenges shaping the future of cryptocurrencies: the absence of clear U.S. regulation, looming risks from quantum computing and growing international momentum around central bank digital currencies (CBDCs).
What Happened: The Stanford Emerging Technology Review 2025, published by the university avoids speculation but presents a data-driven assessment of how unresolved infrastructure, policy, and energy concerns may influence crypto’s trajectory.
The authors highlight that cryptocurrencies currently operate in a fragmented policy environment.
“The lack of a regulatory framework for cryptocurrency affects many American users, consumers, and investors who are often confused about the basic workings of cryptocurrencies and their markets”.
This uncertainty not only deters user confidence but may also “prevent entrepreneurs from implementing their ideas in the United States or inadvertently incentivize them to move offshore”
On the technological front, the report warns that existing public-key encryption used by crypto protocols is not future-proof.
“Support for the transition to a quantum-resistant encryption environment should continue with urgency and focus,” it states.
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Once quantum computers become viable, they could compromise older cryptographic methods, exposing previously encrypted data. “Messages protected by pre-quantum cryptography will be vulnerable in a post-quantum world,” the report adds.
In parallel, global adoption of state-backed digital currencies is accelerating.
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While the U.S. has been cautious, “more than ninety nations are researching, piloting, or deploying CBDCs.”
According to the review, this trend could “reduce global dependence on the US currency and on a financial infrastructure largely controlled today by the United States.”
The authors suggest that delayed action on a U.S. CBDC may undermine traditional financial levers such as economic sanctions.
The report also addresses crypto’s environmental footprint.
“Bitcoin BTC/USD mining uses more energy than the Netherlands,” it stated, adding that whereas Ethereum ETH/USD, following its transition to proof-of-stake, now uses “less than a 10,000th of YouTube’s annual consumption.”
Whether more energy-efficient networks can surpass Bitcoin in market dominance remains uncertain.
What’s Next: Rather than forecasting outcomes, the Stanford Review stresses that these interlocking factors—regulatory frameworks, technological resilience, and geopolitical shifts—will ultimately determine the sustainability and relevance of cryptocurrencies in the years ahead.
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