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Bitwise CIO says protocol revenue links could boost crypto valuations

He expects revenue-capture mechanisms across DeFi and layer-1 networks to broaden over the next 12 to 24 months, potentially supporting token buybacks and burns.

Reported · Written up by our desk · Market Structure

Bitwise chief investment officer Matt Hougan said crypto valuations could rise as more protocols tie revenue to native tokens through mechanisms such as buybacks and token burns, arguing that investors have not fully priced in the shift. In his view, activity on networks increasingly feeds into token value, particularly for assets outside Bitcoin, creating potential undervaluation.

Hougan cited revenue-to-token examples across decentralized finance and related platforms. He pointed to Hyperliquid, which used about 99% of last year’s revenue to buy and burn HYPE, and to Uniswap’s “UNIfication” overhaul, where protocol fees are set to be activated to fund UNI burns on Dec. 22, 2025.

He also highlighted Aave’s buyback efforts, including a program that purchased more than 205,000 AAVE during its first 10 months. Hougan said stronger links between protocol revenue and token value could give investors more conventional valuation metrics, even though token holders do not have shareholders’ legal claims to cash flow and tokenomics can evolve.

Cointelegraph reported the discussion ahead of ongoing expansion of revenue-capture designs, with Hougan expecting decentralized applications and layer-1 networks to adopt similar mechanisms over the next 12 to 24 months.

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