The Lightcone 2025 Forecast

Happy New Year! In this mini-episode, the Lightcone hosts ring in 2025 with their predictions for startups, AI, crypto, and more.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:07Garry Tan?

  Welcome back to a New Year's Day episode of The Light Cone. We wanted to hit you guys with predictions on what's going to happen in 2025. Diana, do you want to start us off?

• 0:20Diana Hu?

  Sure. So last year, AI won two Nobel Prizes. The first one was the Nobel Prize in Physics with Jeff Hinton on his seminal work on deep neural nets. And the second one was a Nobel Prize on Chemistry from Demis and his team on Alpha Fold and Protein Folding. And we're seeing how AI is really accelerating abundance with discoveries with science and technology. And there's a total of six Nobel Prizes. There's four more to go. So why not winning one more? It could be the one on math, perhaps. Could be interesting. I know there's been a lot of collaboration with OpenAI and Terrence Tao, the famous mathematician, and a bunch of researchers trying it, too.

• 1:05Diana Hu?

  Could be one in economics. I don't know if we've come up with some interesting economics theories, but maybe those. I think the piece one in literature might be a bit more tricky.

• 1:15Harj Taggar?

  All right. My one is a dangerous one to make on camera. It's that next year crypto is going to go mainstream. Very specifically, my prediction is this time next year, that you and everyone you know will have bought at least one thing during the year that's like real, like a cup of coffee or a book using a stablecoin. And the reason I think this will happen is payment. When you think about it, like payment networks are actually just marketplaces. The marketplace businesses, you just have like vendors on one side and consumers on the other. And we all know from our work with startups that marketplace businesses are incredibly hard to start because you have a chicken and egg problem. But when you do figure out how to crack the chicken and egg problem, you have incredibly sticky and enduring business.

• 1:59Harj Taggar?

  Like actually, the biggest YC companies are almost all marketplaces. Airbnb, DoorDash, Instacart. I mean Coinbase itself essentially started out as a marketplace, though it has, like an exchange is a marketplace really. I think what's happened with crypto is clearly everyone came in initially for the speculation and buying things where the numbers went up. But stablecoins have emerged as like a truly valuable use case. And so many, many people have a crypto wallet, which at this point is hundreds of millions of people, will recognize that stablecoins are really great way to just buy things. And so you basically have one side of the marketplace lined up. There's hundreds of millions of people who

• 2:40Harj Taggar?

  will have stablecoins in their crypto wallets. All you need now are the merchants to start accepting USDC or a stablecoin. And I think that's actually the much easier part of the marketplace to get.

• 2:52Jared Friedman?

  Yeah, there's a lot fewer of them.

• 2:53Harj Taggar?

  Yep, there's fewer of them. And it's just a more traditional like ground sales game. And I think people, especially now the regulatory environment is looking more optimistic. I think next year you'll just see a big push and you'll walk into your local coffee shop and they'll accept USDC payments. I think it's gonna be huge.

• 3:10Garry Tan?

  It's pretty clear that stablecoins are sort of desperately needed in finance overall. I mean, when you look at something like that Synapse disaster, that startup that lost tens to hundreds of millions of dollars of user funds. If you had open ledger, I think that you would be able to figure it out. But right now, they don't even know where the money went and they don't know how to track it down for people. So it's a pretty wild situation when you really think about it. It's overdue. So I think for mine, I also have one that is kind of crypto related in that I think if Doge, the sort of Elon Musk and Vivek attempt to reduce government waste works, then Dogecoin will go up.

• 3:58Garry Tan?

  In a very circuitous sort of way. You know, I think that interest rates are largely sort of driven, you know, by a lot of different factors, but one of the bigger ones is actually whether or not the government is actually doing a lot of deficit spending. And I think the markets, the way they're moving, at least right now, as we're, you know, watching it in late December, you they think that Trump is probably going to spend a lot more money. But, you know, if Doge is able to actually reduce spending, well, that means that interest rates will come down and, you know, sort of, A, hopefully, the economy will actually pick up. There will be more GDP growth, but also interest rates rule everything around us as we've

• 4:41Garry Tan?

  learned the last, you know, three or four years. So, you know, sort of concretely, as crypto prices go, they turn out to be highly correlated to interest rates. So, interest rates go down, crypto prices, and hopefully GDP goes up. And, you know, likewise, it's probably true that the reverse is also going to happen. If Doge fails in their mission, it seems pretty clear that Trump, left to his own devices, would probably increase, you know, spending the way he did in his first term. And so, I don't know. I mean, what can I say? We're rooting for you, Elon.

• 5:19Harj Taggar?

  Yeah, I think another aspect that ties into what we've been talking about is the worry with lowering interest rates, is that inflation will spur back up? But tech in general is deflationary, and AI in particular may be like the greatest, single greatest deflationary force of our lifetimes. And so, if that plays out, you may well be able to lower interest rates without stimulating huge amounts of inflation.

• 5:41Jared Friedman?

  All right, I've got an AI one, which is a product that I'm just like personally excited to see and play with that I think is going to come out next year. And it's basically, you will be able to have a Zoom call with an AI. Like in 2024, that was the year where you could finally have a phone call with an AI and they got the latency low enough that it felt like natural and real. And I think next year, we're going to be able to do the same thing, but it's going to be like a Zoom call where there's like a face and a whole like virtual avatar, but it's actually like real time and you're interacting with like a virtual like AI person on a screen.

• 6:16Diana Hu?

  That doesn't feel uncanny valley because right now there are different versions of it.

• 6:20Jared Friedman?

  There are, but the latency is bad and the lip syncing is bad. And it's just like, it's just like not a good experience yet, but I think it's gonna, yeah.

• 6:28Harj Taggar?

  Like a 3D Turing test.

• 6:29Jared Friedman?

  Yeah, like a 3D Turing test, yeah.

• 6:32Harj Taggar?

  Maybe we'll get them to do the Lycon episodes for us.

• 6:35Garry Tan?

  Surprise, this is actually all AI.

• 6:38Garry Tan?

  Just kidding, it's still real, it's still real. So with that, we just wanted to give you a lightning episode of our predictions for 2025. Happy New Year and we'll catch you guys next time.