While investing involves a great deal of numbers, it is widely regarded as more of an art than a science.

"The choice of common stocks is a difficult art," Benjamin Graham once warned. His lifelong student, Warren Buffett, further clarified: "Investing is an art… laying out cash now to get more cash back in the future."

Nearly all investing boils down to forecasting future cash flows. Yet, as Peter Lynch cautioned, "Investors trained to rigidly quantify everything are at a great disadvantage."

This doesn’t mean, as some financial nihilists claim, that "valuation is just a meme." Rather, it means applying and interpreting quantifiable valuation metrics is itself a creative endeavor.

Choosing which metrics apply to which investments is subjective—and interpreting those results is even more so. For instance, a low valuation doesn’t always mean a stock is cheap, nor does a high valuation necessarily mean it’s expensive (often, the opposite is true). A stock might appear dirt-cheap on some metrics and wildly overpriced on others—with no obvious correlation between these valuations and actual returns.

This can be frustrating. If cheap stocks don’t rise and expensive ones don’t fall, why bother figuring it all out?

I’d argue it’s worth the effort because this very ambiguity is what makes investing fascinating—and if that’s the case, the fun in crypto investing is just beginning.

Until recently, crypto investors had very limited data to work with—mostly just token prices and market caps. This turned everything in crypto into a "story," but that’s not necessarily a bad thing. Investing is, after all, the art of storytelling.

However, the best investment stories are often told with numbers, and crypto is gradually reaching that stage as more protocols generate revenue—with a growing share of that revenue flowing to token holders.

Thanks to efforts by firms like Blockworks Research, these numbers are becoming more accessible. Their analysts package this data into digestible charts and reports, helping the crypto space evolve into a higher form of storytelling: narratives backed by numbers.

Let’s look at some of these numbers today.

Judging by Crypto Twitter and podcasts, sentiment around Ethereum seems to have hit new lows—especially compared to Solana. But a TradFi newcomer looking purely at the data might draw a very different conclusion.

According to Blockworks Research, Solana recorded $36 million in "net income to token holders" in April, putting the SOL token at a 178x annualized earnings multiple—high, but perhaps justified if current activity levels are considered low.

In contrast, Ethereum posted $21 million in net income to token holders in April, resulting in an 841x earnings multiple for ETH.

A TradFi investor seeing ETH trading at five times SOL’s multiple wouldn’t immediately think, "Wow, why is everyone so bearish on Ethereum?" Nor would they assume the market is five times more bullish on Solana.

Instead, they might conclude that Solana’s lower revenue multiple reflects its reliance on "low-quality" memecoin trading activity, while Ethereum’s higher multiple is partly due to higher-quality revenue streams, such as real-world asset (RWA) activity.

This opens up analytical angles: If you believe memecoin trading isn’t so low-quality, SOL might be undervalued. If you think RWAs are the future, ETH might not be overvalued. And of course, there’s much more to unpack.

Hyperliquid, a semi-decentralized crypto exchange, tells an unusual story: the protocol generated $43 million in revenue in April and distributed nearly all of it to token holders.

Unsurprisingly, this model has driven strong recent performance for its token. As Blockworks Research’s Boccaccio noted in a recent report: "The foundation conducts buybacks with trading fees every 10 minutes, creating constant buy pressure."

Every 10 minutes!

This is hard to evaluate because no TradFi company returns 100% of revenue to shareholders—let alone every 10 minutes.

From a valuation perspective, the crypto market seems unsure too. HYPE trades at ~17x annualized revenue (based on market cap), which would normally be considered expensive. But if revenue and earnings are effectively the same, and if you believe Hyperliquid can keep taking market share from centralized exchanges, this multiple might be justified.

Boccaccio points out that HYPE trades at a premium to its decentralized peers—but those may not be the right comparables. "Hyperliquid’s L1 only needs to capture a tiny fraction of Binance’s daily volume to grow meaningfully… Snagging just 10-15% of Binance’s BTC/USDT volume would increase HyperCore’s trading activity by 50%."

"Thus, the multiple is warranted," Boccaccio concludes. Of course, the size of that multiple depends on how much you believe the story.

Jupiter, a Solana-based DEX aggregator, returns a more modest 50% of revenue to token holders (also via buybacks)—but its revenue is substantial.

Marc Arjoon estimates Jupiter could generate $280 million in revenue over the next 12 months, implying an ~11.5% yield for JUP token holders based on market cap.

In equities, an 11.5% yield usually signals a struggling business—but that doesn’t seem to be the case here.

"Jupiter is Solana’s default router," Arjoon writes, "currently unrivaled in aggregation" and "the fourth-highest revenue-generating dapp in all of crypto."

Even better, it’s run like a real business: "Jupiter’s 2024-2025 strategy suggests an organization aggressively positioning itself as Solana’s top crypto super-app."

This doesn’t sound like a company that should trade at an 11.5% yield.

While risks remain (as Arjoon details), his conclusion is optimistic: "Jupiter trades at an attractive multiple relative to peers, leaving significant upside even without multiple expansion."

He even quantifies this with a sum-of-the-parts valuation—comforting to my TradFi brain:

Helium, a decentralized telecom provider, has long been a crypto talking point—dating back to 2013. But now, it’s not just a story—it’s a story with data.

"Revenue (measured by Data Credit Burn) is accelerating, up 43% quarter-over-quarter," writes Blockworks Research’s Nick Carpinito. "Crucially, revenue is shifting from Helium Mobile to Mobile Offload, which now accounts for 3x more data credit burn and is growing nearly 180% QoQ—an astounding growth rate for a DePIN protocol selling into enterprise budgets."

"Mobile Offload" (the blue line above) is growing at 180% quarterly—a staggering figure by any standard.

Helium’s HNT token appears to reflect this, trading at ~120x annualized revenue. But Carpinito suggests further acceleration is likely, citing "AT&T allowing U.S. subscribers to connect to Helium’s network, driving a surge in data credit usage."

Thus, "over the next 12 months, we could see unprecedented HNT price appreciation—more stable than prior speculative moves."

In crypto, price predictions based on non-speculative factors are rare. And refreshing.

Finally, Pendle—a "yield trading" protocol—recently launched "Boros," a product enabling speculation on any on/off-chain yield, starting with funding rates.

"This mirrors classic interest rate swaps, where traders pay floating to receive fixed (or vice versa), with leverage," explains Blockworks Research’s Luke Leasure.

To my TradFi ears, this sounds complex—but the market is undeniably huge: "Perps markets see ~$60 trillion in annual settlements, with open interest in the hundreds of billions. Boros is entering a massive, untapped market."

Leasure expects Boros could double Pendle’s revenue. In a bullish scenario, Pendle’s "vote-escrowed" token could trade at just 1.6x earnings:

1.6x!

In equities, a 1.6x multiple usually signals imminent collapse—but that’s clearly not the case here.

This isn’t investment advice (certainly not from me), as Pendle’s story is complex—like most things in crypto. But at least now, these stories can be told with numbers.

While investing involves a great deal of numbers, it is widely regarded as more of an art than a science.

"The choice of common stocks is a difficult art," Benjamin Graham once warned. His lifelong student, Warren Buffett, further clarified: "Investing is an art… laying out cash now to get more cash back in the future."

Nearly all investing boils down to forecasting future cash flows. Yet, as Peter Lynch cautioned, "Investors trained to rigidly quantify everything are at a great disadvantage."

This doesn’t mean, as some financial nihilists claim, that "valuation is just a meme." Rather, it means applying and interpreting quantifiable valuation metrics is itself a creative endeavor.

Choosing which metrics apply to which investments is subjective—and interpreting those results is even more so. For instance, a low valuation doesn’t always mean a stock is cheap, nor does a high valuation necessarily mean it’s expensive (often, the opposite is true). A stock might appear dirt-cheap on some metrics and wildly overpriced on others—with no obvious correlation between these valuations and actual returns.

This can be frustrating. If cheap stocks don’t rise and expensive ones don’t fall, why bother figuring it all out?

I’d argue it’s worth the effort because this very ambiguity is what makes investing fascinating—and if that’s the case, the fun in crypto investing is just beginning.

Until recently, crypto investors had very limited data to work with—mostly just token prices and market caps. This turned everything in crypto into a "story," but that’s not necessarily a bad thing. Investing is, after all, the art of storytelling.

However, the best investment stories are often told with numbers, and crypto is gradually reaching that stage as more protocols generate revenue—with a growing share of that revenue flowing to token holders.

Thanks to efforts by firms like Blockworks Research, these numbers are becoming more accessible. Their analysts package this data into digestible charts and reports, helping the crypto space evolve into a higher form of storytelling: narratives backed by numbers.

Let’s look at some of these numbers today.

Judging by Crypto Twitter and podcasts, sentiment around Ethereum seems to have hit new lows—especially compared to Solana. But a TradFi newcomer looking purely at the data might draw a very different conclusion.

According to Blockworks Research, Solana recorded $36 million in "net income to token holders" in April, putting the SOL token at a 178x annualized earnings multiple—high, but perhaps justified if current activity levels are considered low.

In contrast, Ethereum posted $21 million in net income to token holders in April, resulting in an 841x earnings multiple for ETH.

A TradFi investor seeing ETH trading at five times SOL’s multiple wouldn’t immediately think, "Wow, why is everyone so bearish on Ethereum?" Nor would they assume the market is five times more bullish on Solana.

Instead, they might conclude that Solana’s lower revenue multiple reflects its reliance on "low-quality" memecoin trading activity, while Ethereum’s higher multiple is partly due to higher-quality revenue streams, such as real-world asset (RWA) activity.

This opens up analytical angles: If you believe memecoin trading isn’t so low-quality, SOL might be undervalued. If you think RWAs are the future, ETH might not be overvalued. And of course, there’s much more to unpack.

Hyperliquid, a semi-decentralized crypto exchange, tells an unusual story: the protocol generated $43 million in revenue in April and distributed nearly all of it to token holders.

Unsurprisingly, this model has driven strong recent performance for its token. As Blockworks Research’s Boccaccio noted in a recent report: "The foundation conducts buybacks with trading fees every 10 minutes, creating constant buy pressure."

Every 10 minutes!

This is hard to evaluate because no TradFi company returns 100% of revenue to shareholders—let alone every 10 minutes.

From a valuation perspective, the crypto market seems unsure too. HYPE trades at ~17x annualized revenue (based on market cap), which would normally be considered expensive. But if revenue and earnings are effectively the same, and if you believe Hyperliquid can keep taking market share from centralized exchanges, this multiple might be justified.

Boccaccio points out that HYPE trades at a premium to its decentralized peers—but those may not be the right comparables. "Hyperliquid’s L1 only needs to capture a tiny fraction of Binance’s daily volume to grow meaningfully… Snagging just 10-15% of Binance’s BTC/USDT volume would increase HyperCore’s trading activity by 50%."

"Thus, the multiple is warranted," Boccaccio concludes. Of course, the size of that multiple depends on how much you believe the story.

Jupiter, a Solana-based DEX aggregator, returns a more modest 50% of revenue to token holders (also via buybacks)—but its revenue is substantial.

Marc Arjoon estimates Jupiter could generate $280 million in revenue over the next 12 months, implying an ~11.5% yield for JUP token holders based on market cap.

In equities, an 11.5% yield usually signals a struggling business—but that doesn’t seem to be the case here.

"Jupiter is Solana’s default router," Arjoon writes, "currently unrivaled in aggregation" and "the fourth-highest revenue-generating dapp in all of crypto."

Even better, it’s run like a real business: "Jupiter’s 2024-2025 strategy suggests an organization aggressively positioning itself as Solana’s top crypto super-app."

This doesn’t sound like a company that should trade at an 11.5% yield.

While risks remain (as Arjoon details), his conclusion is optimistic: "Jupiter trades at an attractive multiple relative to peers, leaving significant upside even without multiple expansion."

He even quantifies this with a sum-of-the-parts valuation—comforting to my TradFi brain:

Helium, a decentralized telecom provider, has long been a crypto talking point—dating back to 2013. But now, it’s not just a story—it’s a story with data.

"Revenue (measured by Data Credit Burn) is accelerating, up 43% quarter-over-quarter," writes Blockworks Research’s Nick Carpinito. "Crucially, revenue is shifting from Helium Mobile to Mobile Offload, which now accounts for 3x more data credit burn and is growing nearly 180% QoQ—an astounding growth rate for a DePIN protocol selling into enterprise budgets."

"Mobile Offload" (the blue line above) is growing at 180% quarterly—a staggering figure by any standard.

Helium’s HNT token appears to reflect this, trading at ~120x annualized revenue. But Carpinito suggests further acceleration is likely, citing "AT&T allowing U.S. subscribers to connect to Helium’s network, driving a surge in data credit usage."

Thus, "over the next 12 months, we could see unprecedented HNT price appreciation—more stable than prior speculative moves."

In crypto, price predictions based on non-speculative factors are rare. And refreshing.

Finally, Pendle—a "yield trading" protocol—recently launched "Boros," a product enabling speculation on any on/off-chain yield, starting with funding rates.

"This mirrors classic interest rate swaps, where traders pay floating to receive fixed (or vice versa), with leverage," explains Blockworks Research’s Luke Leasure.

To my TradFi ears, this sounds complex—but the market is undeniably huge: "Perps markets see ~$60 trillion in annual settlements, with open interest in the hundreds of billions. Boros is entering a massive, untapped market."

Leasure expects Boros could double Pendle’s revenue. In a bullish scenario, Pendle’s "vote-escrowed" token could trade at just 1.6x earnings:

1.6x!

In equities, a 1.6x multiple usually signals imminent collapse—but that’s clearly not the case here.

This isn’t investment advice (certainly not from me), as Pendle’s story is complex—like most things in crypto. But at least now, these stories can be told with numbers.