Bitwise Asset Management Chief Investment Officer Matt Hougan argued on Aug. 12 that crypto valuations outside Bitcoin could rise sharply as more protocols connect revenue generated by network activity to their native tokens. In a memo and posts on X, he said the market will continue to grow around projects that generate actual profits rather than speculative narratives, adding that if the link between protocol revenue and token value keeps strengthening, ‘we could see valuations double or more.’
Hougan highlighted several protocols—including Hyperliquid, Uniswap, Aave, Aptos, Pump.fun and Solana—that are using generated fees for buybacks or token burns. He expects more DeFi applications and layer 1 networks to adopt similar structures over the next 12 to 24 months.
Hyperliquid provides one of the clearest examples. Its Assistance Fund converts trading fees into HYPE, and acquired tokens are burned and removed from circulating and total supply. Hougan estimates roughly 99% of fee revenue has been directed toward the mechanism, with more than $1.16 billion in trading fees previously routed into HYPE purchases.
Uniswap and Aave show two different revenue models. Since governance approved UNIfication in December 2025, Uniswap burned 100 million UNI from the treasury and activated protocol fees. By July, protocol fees had financed about 7.5 million additional UNI burns worth roughly $25.6 million. Aave's buyback program acquired more than 205,000 AAVE during its first 10 months after launching in April 2025, using about $42 million in allocations and representing more than 1.28% of AAVE's 16 million total supply.
Pump.fun directs 50% of net protocol revenue toward automated PUMP buybacks and burns. Between Aug. 3 and Aug. 9, it generated $10.03 million in weekly protocol fees and burned $5.02 million of PUMP, purchasing and burning 2.15 billion PUMP. On Solana, the SGP 0003 process includes SIMD 0553, which would replace the flat signature fee with an inclusion fee plus a resource-based charge that is burned. Modeling suggests daily burns could rise from roughly 648 SOL to between 7,500 and 9,000 SOL, though validator approval is still required.
Hougan also linked the shift to a more permissive U.S. regulatory environment, citing the Ripple litigation and the change in SEC leadership. The SEC is scheduled to hold an open meeting on Aug. 14 to consider tailored offering rules for certain investment contracts involving crypto assets. He cautioned that token buybacks are not legally identical to stock buybacks, and the revenue capture thesis remains an investment view rather than an established legal outcome.
