Bitwise Chief Investment Officer Matt Hougan projects crypto valuations, excluding Bitcoin, could at least double over the next 12 to 24 months, driven by a growing trend among protocols to route revenue toward native token buybacks and burns.
Hougan said on Aug. 13 that network activity will increasingly feed directly into token value across decentralized finance applications and Layer 1 networks. He believes investors have not yet priced in this shift, leaving many crypto assets undervalued.
The mechanism works directly: protocols generate fees from operations, then use those fees to repurchase tokens from the open market or permanently remove them from circulation.
Hyperliquid, a decentralized perpetual futures exchange, exemplifies this model. The protocol generated over $800 million in revenue last year, with approximately 99 percent directed to buy and burn its native HYPE token. On Aug. 6, Hyperliquid reported $169 million in second-quarter revenue, allocating $141 million from that quarter to HYPE buybacks.
Uniswap adopted a revenue-to-token mechanism following its UNIfication overhaul. The governance proposal, approved Dec. 22, 2025, activated protocol fees to fund UNI burns. Collected fees can now be claimed by burning UNI, directly linking protocol activity to supply reduction.
Aave DAO implemented a buyback program that acquired more than 205,000 AAVE tokens during its initial 10-month period. Aave founder Stani Kulechov said June 25 the team was developing an automated, non-discretionary mechanism for these buybacks. "100% of Aave Protocol and GHO revenue goes to the AAVE token," Kulechov said. "This was established in the Aave Will Win proposal."
Hougan also cited Pump.fun and Lighter as protocols demonstrating this shift.
Hougan attributed this change to a more permissive regulatory environment. On Aug. 5, he noted that current regulatory guidance could facilitate crypto expansion even without passage of the CLARITY Act, a market-structure bill. For years, projects avoided integrating revenue-sharing features due to securities law concerns.
Token holders lack the legal claims to cash flow that traditional shareholders possess, and tokenomics governing these mechanisms are community-set and subject to change through governance proposals. This evolution introduces conventional valuation metrics to crypto markets, moving beyond speculative models and providing a clearer framework for assessing asset value based on fundamental activity.
