Crypto Valuations Could Double as Protocols Link Revenue to Tokens

Bitwise CIO Matt Hougan believes that crypto valuations could double or more if protocols continue to link revenue generated by network activity to their native tokens. This is based on his analysis of several projects, including Hyperliquid, Uniswap, Aave, Pump.fun, and Lighter, which use fees or other protocol revenue to finance token purchases or burns.

Hyperteam's Hyperliquid provides a clear example of this trend, with roughly 99% of its trading fee revenue directed towards buying HYPE tokens through the Assistance Fund mechanism. This has created recurring demand for HYPE linked to exchange activity.

Other projects like Uniswap and Aave are also implementing similar structures, with Uniswap's automated burn system having financed around $25.6 million in UNI burns since December 2025. Meanwhile, Aave's buyback program has acquired over 205,000 AAVE tokens using $42 million in allocations.

Hougan attributes part of this shift towards token revenue mechanisms to a more permissive U.S. regulatory environment. He points out that the SEC's adoption of an interpretation creating categories for crypto assets and addressing when a non-security crypto asset may be involved in an investment contract has provided clearer boundaries under existing federal securities laws.