Token buybacks keep growing, but the price floor keeps failing

In an August 12 memo, Matt Hougan, chief investment officer at asset manager Bitwise, said most crypto tokens other than Bitcoin are undervalued.

Investors are not aware of how much revenue protocols now pay back to holders. The clearest example is Hyperliquid retiring $1.3 billion of its HYPE token, he said. If the trend continues, the market “could see valuations double or more,” Hougan added.

Hougan says tokens now trade on revenue

For years, the main criticism of crypto was that networks could scale significantly, yet tokens captured little value.

Hougan said, “That era is over,” in the memo titled “Crypto’s Revenue Revolution.” He believes tokens are beginning to trade on the same yardstick as equities and bonds, which is revenue.

Hougan explicitly tied his valuation claim to his belief that the link between protocol revenue and token price is strengthening. Bitwise said the memo represents a snapshot assessment and is not investment advice.

Hyperliquid generated over $800 million in revenue in the last year. The DEX sends about 99% of its fees to buy HYPE on the open market and burn it, according to the Bitwise memo.

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