June 17, 2026
A recurring question we get from investors considering crypto is, how should we properly value digital assets? At Grayscale, we apply a valuation framework that, at its highest level, analyzes the crypto universe across a spectrum between assets driven by commodity-like factors and those that more closely resemble claims on cash flows.
Crypto assets like Bitcoin, for example, are digital commodities that can be valued based on supply and demand. Other crypto assets, such as Hyperliquid, are directly tied to revenue-producing activity and can be valued with cash flows. At a more detailed level, our framework also offers nuances, revealing a spectrum that runs between the two (Exhibit 1).
My colleague Charlie Perkins details our valuation framework in a new report, Guide to Buying the Dip: Valuing Crypto with Cash Flows. The report focuses on Aave, the leading onchain lending platform. And although we use traditional valuation metrics, such as discounted cash flow (DCF) analysis, the report also highlights some unique features of crypto tokens, including:
As of mid-June, putting all the elements together, we arrive at a one-year price target for the AAVE token of $175—about 130% above current levels. Applying similar methodologies to other cash-flow producing crypto protocols—such as HYPE, for example—suggests that many of them also offer attractive entry points at current valuations.
Key Takeaway: Many crypto assets can be valued with cash flows. After the recent drawdown, we believe many leading tokens look cheap relative to fair value.
Exhibit 1: Crypto assets range from pure commodities to those that are cash flow-driven, with a wide spectrum in between
