In a memo dated August 12, Matt Hougan, Chief Investment Officer of asset management firm Bitwise, stated that most crypto tokens, except Bitcoin, are currently undervalued.
Investors have not yet fully realized the scale of revenue that protocols are now returning to holders. The most typical example is Hyperliquid, which has burned $1.3 billion worth of HYPE tokens. Hougan pointed out that if this trend continues, the market "could see valuations double or even more."
In this memo titled "The Crypto Revenue Revolution," Hougan argues that tokens are beginning to trade based on revenue as a metric, similar to stocks and bonds. He explicitly links this valuation judgment to the strengthening correlation between protocol revenue and token prices. Bitwise stated that the memo is only a point-in-time assessment and does not constitute investment advice.
According to the Bitwise memo, Hyperliquid generated over $800 million in revenue in the past year, and the DEX uses approximately 99% of its fees to buy HYPE on the open market and burn it. Since the token's launch in November 2024, these buybacks have cumulatively removed $1.3 billion worth of HYPE from the circulating supply permanently.
Hougan noted that HYPE has risen about 800% since its launch, while Bitcoin fell about a third over the same period. He attributes part of the gains to buyers anticipating that rising trading volumes will directly translate into burns. CoinGecko data shows HYPE is currently trading at $57.77, up 2.8% in the last seven days and 11.1% in the last thirty days.
Uniswap and Aave have also joined this trend. Uniswap first enabled protocol fees in a December 2025 vote on "UNIfication" and immediately burned 100 million UNI (approximately $590 million). Currently, Uniswap generates about $100 million in annual revenue, all of which is used for buybacks.
Aave plans to burn approximately $30 million worth of AAVE annually, nearly one-fifth of its revenue, and has implemented an automated program called Aavenomics 3.0. Pump.fun has an annual revenue of $328 million and, as of April 2026, has burned $370 million worth of PUMP. Emerging perpetual contract platform Lighter has bought back about 6% of LIT supply on the basis of $67 million in revenue.
Hougan said the "revenue craze" has spread to base-layer blockchains. The Solana community has proposed SGP-0003, which aims to increase the fee burn ratio by up to 14 times the current level. Aptos has increased gas fees tenfold this year, with on-chain activity nearly tripling, and annual token burns rising from about 90,000 to about 1.9 million.
However, a survey report from January this year found that supply reductions have not reliably driven price increases, and many tokens with regular buybacks still underperformed the broader market and failed to hold price bottoms. Even Hyperliquid has broken its initial "only goes up" trend. Pump.fun once bought back more than 18% of its total supply, but the token price still hovers near lows.
Hougan cautioned that token buybacks differ from stock buybacks because holders have no contractual rights to profits or assets, and governance mechanisms can be rewritten or economic models modified at any time.
