How to use 30 AMP wire to make 120 outlet
yes You can turn this into a 15 or 20 amp receptacle possibly even 2 circuits depending on how many wires in the cable. 
If there is Black, white and a ground you will need to move the wires around in the panel but a legal 15 or 20 amp 120v circuit can be set up. 

If this is a main panel 
Put the white on the neutral bus or the ground bus (if white and bare copper are on the same bus(es) either one, of your white wire is too short a splice of white wire long enough to reach the bus is ok. I don’t like changing wire size but if you use the 15 amp breaker you have 14 awg white is ok, if you go for a 20 amp breaker, 12 awg white will be needed. 

Next you will need a receptacle, I prefer spec grade back and side they cost a bit more but as most 15 amp receptacles the number 10 wire should fit under the screws. 

Wire the white to the silver screw, the black to the brass colored screw and the bare copper to the green screw. 

If your cable happens to have 4 wires you could create a multi wire branch circuit (2 circuits) but most water heaters are wired with 3 wires.

Using larger wire is ok and in this case it should fit a receptacle (30 amp wire is normally 10 awg) but could be larger and in that case you would need to pigtail to smaller wire at the receptacle and possibly the breaker.

Update: the op said 25 amp breaker in comment while I was typing the breaker would need to be down sized to feed a standard receptacle. The max breaker is 20 amp and would require a 15 amp duplex receptacle. And 12 awg pig tail if needed.