Crypto Tokens Boosting Value Capture: Price Surge Expected in 2026

Crypto Tokens Boosting Value Capture: Price Surge Expected in 2026

Matt Hougan, chief investment officer at Bitwise, suggests that crypto tokens are experiencing significant improvements in their ability to capture value, driven in part by new regulations and ongoing upgrades. Hougan anticipates that these factors could lead to a substantial price surge by 2026.

Driving Forces Behind Enhanced Token Value

Hougan noted in an X post that amidst the current market volatility, crucial news is being overlooked, such as the rising trend in digital asset value capture. He mentioned that most existing tokens were created in a regulatory environment that made value capture risky, leading them to adopt vague governance-style designs. However, with new regulatory developments, these limitations are being lifted, and Hougan expects this impact to become noticeable by 2026.

Uniswap as an Example of Value Enhancement

Uniswap (UNI), the native token behind the crypto protocol of the same name, saw a notable surge earlier this month after the Uniswap Foundation and Uniswap Labs introduced a proposal aimed at making the token more attractive as an investment. The ideas presented included a protocol-level fee mechanism to burn tokens and the development of a Protocol Fee Discount Auctions system to boost liquidity provider returns. Hougan considers this example one of the most prominent illustrations of a token attempting to capture value. He anticipates that if the proposal is approved, it could lead to UNI entering the top ten in terms of market capitalization in the future. He added that the significant criticism UNI has consistently faced is that it is merely a governance token, and activity on Uniswap did not benefit UNI token holders. However, with the consideration of changing the fee mechanism, where approximately 16% of trading fees will be used to burn UNI, he expects this to propel UNI towards becoming one of the top 10 tokens in terms of market capitalization over time.

Ethereum's Fusako Upgrade as a Potential Catalyst

Hougan also pointed to Ethereum's Fusako upgrade as a catalyst that could significantly increase token value. The mainnet launch of the Fusako upgrade is expected in December, which will include upgrades to Ethereum's execution layer and improvements to staking economics, among other upgrades. Hougan anticipates that the market will soon begin to focus on the positive impacts of Fusako, particularly if it is launched on December 3 as expected. He considers it an underappreciated catalyst, and one of the reasons why ETH could lead the crypto rebound.

XRP Staking Rewards as an Additional Bonus

Hougan mentioned that Ripple's XRP token is also on track to increase its value retention with a potential addition of staking. He added that there is an increasing focus on value retention in XRP as well, and that the community has begun considering ideas such as staking, which would change the economics for token holders. He affirmed that the common factor is that the level of value retention in digital assets is only trending upwards from here, and that people perceive token value retention as static, which is not the case.