3 days ago by Connor King
We mapped 159 tokens across six value accrual mechanisms and tested which translate into tokenholder returns.
The crypto narrative on token value accrual is mostly wrong.
Two weeks ago, we published "IR & Token Transparency in 2026". One finding from that audit: 38% of crypto protocols have active value accrual. 62% return nothing to token holders.
This piece is the companion analysis. We took the 159-protocol dataset, classified every token by accrual mechanism, and pulled 1-year price performance from @artemis. The question: which mechanisms actually translate into returns?
The six models we identified: direct fee distribution, buyback-and-burn, buyback-and-hold, vote-escrow (ve-model), governance-only, and other/hybrid.
Here's what we found:
The 49 protocols across direct-fee, buyback-burn, buyback-hold, and ve-model averaged -55% over the trailing year. The 48 governance-only protocols averaged -65%.
The gap widens when restricted to revenue-generating governance-only tokens like Uniswap, Arbitrum, and Morpho. These protocols generate real revenue and route none of it to token holders. The opportunity cost is the most visible part of the dataset.
Governance-only is the IR equivalent of a public company paying no dividend and buying back no stock. Eventually allocators stop pretending it's a going concern and start pricing it as an option on management waking up.
On headline numbers, buyback-and-burn won this year (-35% avg) and buyback-and-hold came second (-52%). That reads as a clean win for burns.
The story inverts when you strip out Hyperliquid. Ex-HYPE, buyback-and-burn averaged -56% and buyback-and-hold averaged -52%. One token decided the entire category.
Meteora is the cleanest buyback-and-hold case. $10M buyback program, 95/100 Novora IR Score, transparent treasury accumulation. Down ~40% on the year, less than the cohort median. Holding the bought tokens in a transparent treasury preserves optionality and creates a visible, audited float. Burns destroy optionality in exchange for a marketing headline.
Sort the 50 protocols with clean Artemis revenue data by daily revenue and the pattern is clearer than any mechanism split.
The top quintile by revenue averaged +8% returns. The bottom quintile averaged -81%.
The two protocols generating more than $500K/day in revenue are Hyperliquid and Polymarket. Both are the standout performers in the dataset. Their accrual models are different. Their revenue trajectories are not.
Direct fee distribution is the most legible model for institutional allocators because it maps cleanly to a dividend. dYdX runs the textbook version: 100% of trading fees to stakers, 75% net revenue buyback, best-in-class IR infrastructure.
dYdX is down 82% over the last 12 months. The mechanism did exactly what it promised. The business did not.
Hyperliquid is the inverse. Buyback-and-burn via the Assistance Fund (99% of fees), zero traditional IR infrastructure, +193% on the year.
If you are an allocator, this is the cleanest read in the dataset: you are buying a share of protocol revenue, and if revenue drops, so does the token. Mechanism is table stakes. Revenue trajectory is everything.
The ve-model requires perpetual bribes to function
Aerodrome is the only ve-model token in the dataset with positive 1Y return (+5%). The mechanism depends on Base ecosystem inflows sustaining the bribe market.
Velodrome, Curve, Balancer, and every smaller ve-fork printed -54% to -84%. The ve-flywheel works, but the flywheel needs continuous new capital. When that stops, the whole structure unwinds.
This is not a knock on the model. It is a recognition that ve-tokens are a leveraged bet on ecosystem inflows, not necessarily a bet on pure protocol fundamentals.
Points programs, RWAs, LRTs, memecoins, stablecoins. 62 protocols. The most heterogeneous category in the dataset. Average 1Y return: -71%.
This is where most 2024–2025 launches ended up: EtherFi, Renzo, Puffer, Usual, Virtuals, AI16Z, the entire LRT cohort, the memecoin cohort. These tokens traded on narrative and TGE airdrops, not on cash-flow mechanics. Once the airdrop unlock printed, there was nothing left to defend the price with.
Investor legibility is the underlying issue. An allocator cannot underwrite a token whose accrual mechanism depends on future narrative.
Average 1Y return by accrual model:
Buyback-and-burn: -35% (carried by Hyperliquid; -56% ex-HYPE)
Buyback-and-hold: -52%
Direct fee distribution: -55%
Governance-only: -65%
Vote-escrow (ve-model): -67%
Other / hybrid: -71%
Of 135 protocols with empirical performance data, 5 finished the trailing year positive. Median return: -66%.
The market will not pay a premium for good mechanism design. It will punish the absence of any mechanism at all.
The cleanest empirical read of 2025 is that value accrual did not generate alpha. Revenue did. But the 48 governance-only protocols in this dataset show the cost of going without a mechanism. When the market has a choice between a token that pays you and a token that does not, it picks the one that pays.
The right question for a treasury is not which mechanism maximizes upside. The data says none of them reliably do. The right question is which mechanism makes this token investable from a fundamental lens of an institutional allocator.
That lens rules out governance-only and hybrid categories immediately. It favors buyback-and-hold with transparent treasury disclosure, buyback-and-burn for protocols at scale (Hyperliquid), direct fee distribution for mature revenue-generating protocols, and, for a narrow slice of DEX-native tokens, a ve-model tied to a live bribe market.
For everything else, including most tokens launched in the last 24 months, the honest answer is retrofit a mechanism before your next unlock. Do it while you still have optionality.
The full interactive report with all 159 protocols and the filterable dataset is live at:
**novora.co/research/value-accrual-2026.html **
*This article is for informational purposes only and does not constitute financial, investment, or legal advice. All data was verified against publicly available sources as of April 2026. Novora may have advisory relationships with protocols referenced in this report. Always conduct your own research and consult a qualified financial advisor before making investment decisions. * novora.co/research
Reactions and replies to this article.
Vasily Sumanov
@vasily_sumanov
A lot of these tokens were ruined not supply problems (huge inflation, insiders selling) and business issues (inability of protocol to generate money). Does perfect token design/distribution mechanism make sense if there is nothing to distribute ?
Thomas Morel L’Horset
@thomas_morelll
Awesome research. It's exactly what the space needs. The downstream question I have is how we can actually build consensus on valuation models given how differently value accrues.
Vasily Sumanov
@vasily_sumanov
@thomas_morelll @connorking I proposed one standardised metric - Holders P/FCF + value structure graphs (to map cashflow sources and their dependencies)
𝕋𝕖𝕞𝕞𝕪🦇🔊
@only1temmy
Good feedback "The market will not pay a premium for good mechanism design. It will punish the absence of any mechanism at all."
Crypto Value Labs
@cryptovaluelabs
so even with the best in class token design still down 50% in a year... not a very inspiring stat Great study though - thanks
Eddy Lazzarin 🟠🔭
@eddylazzarin
Great piece and very consistent with my thinking. Tokens need a value capture mechanism. I like buy-and-burn but with the caveat that protocols need to spend to grow.
Shachi
@shachikyoto
"The market will not pay a premium for good mechanism design. It will punish the absence of any mechanism at all. The cleanest empirical read of 2025 is that value accrual did not generate alpha. Revenue did." @xbt2027 very interesting report on token models.