According to Woofun AI, Bitcoin fell into a two-month crunch after experiencing a 21% surge in August, but the DeFi sector experienced an independent market. In the statistical range from August 22 to October 20, the daily closing price of Bitcoin was repeatedly tugged between 75,600 and 8,6600 US dollars. The overall increase was only 5.6%, while Ethereum bucked the trend and fell 2.7%.
However, out of 19 selected top DeFi tokens with a backup dividend mechanism, as many as 14 successfully outperformed Bitcoin. Among them, Raydium came out on top with an astonishing increase of 178%. The median increase of 12.9% of this batch of tokens was more than double that of Bitcoin, showing a strong preference for projects with real revenue distribution capabilities.
Why is the market starting to focus on “actual benefits distributed to holders”? The underlying reason is that simply observing the total revenue of an agreement is extremely misleading. While many agreements have good book revenue, profits are not returned to token holders, but are kept by the team or used for other non-dividend purposes. Therefore, this study uses DeFilLama's data caliber to specifically count “actual benefits” including token buybacks and destruction, fee burning, and revenue distributed directly to coin holders. The screening criteria are extremely strict: only core DeFi projects are included, covering DEXs, perpetual contracts, loans, collateral positions, liquid staking, yield tools, and revenue aggregators, and clearly excluding public chains, oracles, and launchpads (such as Pons, etc.).
Additionally, the selected tokens must have a market capitalization of over $100 million on August 22, and have an actual dividend record in the past year. The price data comes from CoinGecko, and the statistical range was locked from August 22 to October 20, and 19 samples were finally locked. The “market capitalization/annualized income of holders” index mentioned in the article is the total market value divided by the total income distributed to holders in one year according to the current level of earnings. The lower this value, the lower the cost that investors pay for each dollar of dividends, and the stronger the valuation appeal in theory.
Data compiled by Woofun AI showed that tokens were compared in groups according to dividend growth. The difference in results was significant: the median increase of 18.3% in the dividend growth group was as high as 18.3%, while the other group was only 6.9%. The top projects all have a clear revenue growth logic. Raydium ushered in a key turning point on September 5, when tokenized stock issuance platform StonkFun connected to its LaunchLab business, boosting the RAY token repurchase scale from $360,000 in July to $3.94 million in September, an 11-fold increase.
Uniswap, on the other hand, benefited from the huge number of transactions brought by Robinhood Chain (HOOD.US). In September, the public chain contributed nearly half of the contract revenue, superimposed the existing handling fee dividend mechanism, and performed strongly. After Aerodrome's merger with Velodrome, token holders can not only receive transaction fees, but also share the cost of purchasing liquidity from various projects. In September, this revenue reached US$14.9 million, surpassing the US$10.5 million paid to liquidity providers for the first time. Conversely, EdgeX was the worst performing project in the sample due to a 15% drop in actual revenue distributed to holders and a sharp 22% drop in currency prices, verifying the negative impact of falling earnings on currency prices.
Valuation traps and anomalous samples reveal the complexity of the market, and undervaluation does not equal high return opportunities. The lowest AERO valuation ratio was only 8.7 times, and the currency price surged 77%; while EdgeX was valued 15 times, ranking the second lowest in the sample, but the market was at the bottom. This shows that it is impossible to predict ups and downs by simply relying on high or low valuations. The performance of some tokens deviated from conventional logic: the earnings distributed by Hyperliquid (HYPE) to holders surged 79%, but the price of the coin only increased slightly by 6%.
Based on fully diluted valuation (FDV), its valuation is as high as 85 times, and about 800 million US dollars of HYPE unlock outflows every month, while the monthly repurchase amount is only 75 million US dollars, and huge sell-off pressure suppresses the price of the currency. Over these 59 days, Hyperliquid distributed $146.9 million in revenue to holders, representing 59% of the sample's total revenue, and the team unlocked approximately 9.9 million HYPE units per month.
Sky (SKY) passed a governance vote on August 13, using 55% of the proceeds from each instalment to repurchase tokens and distributing 45% to pledger users. Holders' earnings quadrupled, but the currency price only increased 11%, and its valuation ratio was reduced from 98 times to 28.5 times. Aave was affected by the RsETH security incident. Repurchases were suspended and there were no dividends during the statistical period, and the currency price still rose by 24%. Lido's buyback needs to be uniformly executed through DAO voting, and a low monthly return does not mean the end of dividends. Meteora has just launched due to the dividend function, and there is no historical data comparison. THORChain's RUNE destruction ratio was reduced from 5% to 1% on September 12, and its currency price fluctuation was unrelated to the dividend growth logic.
Facing Bitcoin's likely continued sideways trend, the investment strategy for DeFi tokens needs to return to fundamentals. An effective stock selection method must simultaneously satisfy three points: first, the actual income distributed to coin holders from the project shows an upward trend; second, there are clear favorable drivers, such as new business launches, surges in transaction volume or agreement mergers; third, the token unlocking situation and FDV complete dilution valuation must be strictly examined. The Hyperliquid case warns us that large-scale lifting of the ban will seriously suppress coin price increases. It should be noted that the study included only 19 token samples, and the statistical period was 59 days, and the findings were not absolutely universal. If the observation period is extended, the ranking of midstream tokens may be drastically revised. This method is only an observational indicator; it does not mean that rising currencies can be accurately selected on August 22. The valuation multiples in the article are calculated based on market value in circulation. Many projects have large lock-ups, resulting in apparently cheap valuations. For example, Hyperliquid's market value is 19.6 times the market value in circulation (market value of $181 billion in circulation), but the FDV valuation is as high as 85 times (FDV778 billion US dollars).
Although DeFilLama data is already the highest quality source in the industry, it is not 100% accurate, and investors need to make comprehensive judgments based on multi-dimensional data.