Bitwise Forecasts Crypto Valuations Doubling as Protocols Adopt Revenue-Linked Buybacks

Bitwise CIO predicts crypto valuations could double as protocols shift to revenue-driven buyback models. Hyperliquid and Aave lead adoption, with significant capital redirected to token burns.

Woofun AI reports that Matt Hougan, chief investment officer at Bitwise Asset Management, anticipates crypto asset valuations may at least double as protocols increasingly utilize revenues for token buybacks or burns. He argues that the market is transitioning toward revenue-driven models, a shift investors have yet to fully price in, potentially leaving certain assets undervalued.

Hougan highlights that Hyperliquid, Uniswap, Aave, Pump.fun, and Lighter have already implemented fee-based buybacks or removals from circulation, expecting widespread adoption by DeFi applications and Layer-1 networks within the next 12 to 24 months. Hyperliquid generated over $800 million in revenue last year, allocating approximately 99% to buyback and burn HYPE; its second-quarter revenue reached $169 million, with $141 million spent on acquiring HYPE.

Additionally, the Aave DAO acquired more than 205,000 AAVE tokens during the first 10 months of its program. Stani Kulechov, founder of Aave, stated that the team is developing an automated buyback mechanism, directing all revenues from the Aave Protocol and GHO toward the AAVE token. Hougan also noted that easing U.S. regulatory conditions may support continued market expansion without reliance on the CLARITY Act.