In an August 12 memo, Matt Hougan, chief funding officer at asset supervisor Bitwise, stated most crypto tokens aside from Bitcoin are undervalued.
Traders are usually not conscious of how a lot income protocols now pay again to holders. The clearest instance is Hyperliquid retiring $1.3 billion of its HYPE token, he stated. If the development continues, the market “may see valuations double or extra,” Hougan added.
Hougan says tokens now commerce on income
For years, the primary criticism of crypto was that networks may scale considerably, but tokens captured little worth.
Hougan stated, “That period is over,” within the memo titled “Crypto’s Income Revolution.” He believes tokens are starting to commerce on the identical yardstick as equities and bonds, which is income.
Hougan explicitly tied his valuation declare to his perception that the hyperlink between protocol income and token value is strengthening. Bitwise stated the memo represents a snapshot evaluation and isn’t funding recommendation.
Hyperliquid generated over $800 million in income within the final yr. The DEX sends about 99% of its fees to purchase HYPE on the open market and burn it, in keeping with the Bitwise memo.
Because the token went reside in November 2024, these purchases take $1.3 billion of HYPE out of provide completely.
Hougan stated HYPE is up about 800% since launch, at a time when Bitcoin has misplaced a few third of its worth. He credit half of the HYPE’s run to consumers predicting that rising quantity would feed straight into the burn.
HYPE modified fingers at $57.77, up 2.8% over seven days and 11.1% over the previous 30 days, in keeping with CoinGecko data.
Uniswap and Aave copy Hyperliquid’s mannequin
Uniswap’s December 2025 vote on “UNIfication” switched on protocol fees for the primary time, immediately burning 100 million UNI, or about $590 million. It now generates about $100 million a yr, and it spends all of that on buybacks.
Aave plans to burn about $30 million of AAVE per yr, near a fifth of its income. It has carried out an automatic program known as Aavenomics 3.0.
Pump.enjoyable, doing $328 million in annual income, had burned $370 million of PUMP by April 2026. Lighter, a more recent perpetuals venue, purchased again about 6% of its LIT provide on $67 million of income.
“Income fever” has reached base-layer chains, Hougan stated. Solana’s neighborhood has proposed SGP-0003 to extend its price burn as much as 14 instances.
Aptos hiked gasoline fees tenfold this yr. Exercise on Aptos nearly tripled, and annual token burns soared from ~90,000 to about 1.9 million.
A January Cryptopolitan report discovered that shrinking provide has not reliably lifted costs and that many tokens with common buybacks nonetheless underperformed the market and failed to carry a ground.
Even Hyperliquid broke its preliminary “up solely” sample. Pump.enjoyable, at one level, had repurchased greater than 18% of its provide whereas the token sat close to its lows.
Hougan stated {that a} token buyback is just not like a inventory buyback since there’s no contractual proper to income or belongings. Governance can at all times rewrite or change the economics.
