Bitwise CIO: Token Revenue Could Double Crypto Valuations

Bitwise Chief Investment Officer Matt Hougan said on Aug. 12 that crypto valuations outside Bitcoin could double if more projects link token value to protocol revenue. He named five projects already using the approach: Hyperliquid, Uniswap, Aave, Pump.fun and Lighter.

Hougan expects more decentralized finance apps and layer 1 networks to adopt the model over the next one to two years. Many governance tokens once gave holders voting rights without linking token demand to protocol fees. Buyback and burn systems attempt to fix that by using fees to buy tokens and remove them from supply.

Hyperliquid is a clear example. Its Assistance Fund takes trading fees and converts them into HYPE, which gets burned. Hougan estimates close to 99% of Hyperliquid's fee revenue goes toward this fund. The platform has routed more than $1.16 billion in fees into HYPE purchases.

Hougan compared the setup to stock buybacks, though token holders do not carry the same legal claims as company shareholders. Uniswap expanded its burn system after a December 2025 governance vote called UNIfication. That vote burned 100 million UNI from the treasury and turned on protocol fees. By July, Uniswap governance said fees had funded about 7.5 million more UNI in burns, worth close to $25.6 million. On July 27, voters approved turning on more fees across networks including Ethereum, Arbitrum, Base, BNB Chain, Polygon, Optimism and Robinhood Chain.

Aave runs a different program. Records show it bought back more than 205,000 AAVE in its first 10 months, using $42 million in funding. Aave founder Stani Kulechov said in June that all revenue from Aave products and GHO goes to the AAVE token and that the team is building an automated buyback system called Aavenomics 3.0.

Pump.fun uses a simpler split. The platform sends half of its net revenue toward buybacks and burns of its PUMP token. Crypto.news reported that Pump.fun made $10.03 million in weekly fees and burned $5.02 million worth of PUMP between Aug. 3 and Aug. 9. Solana is weighing similar changes. A proposal called SIMD 0553 would replace the network's flat fee with a new charge that gets burned, which could raise daily burns from around 648 SOL to between 7,500 and 9,000 SOL.

Hougan linked these shifts partly to a friendlier U.S. regulatory setting, pointing to the Ripple case and changes in SEC leadership. The SEC will hold a meeting on Aug. 14 to discuss possible new rules for certain crypto asset offerings. The agenda does not say the rules will directly address token revenue sharing.