Hyperliquid

Jupiter

Rewards

Aave

<div style="margin: 26px 0; padding: 16px 20px; border: 1px dotted rgba(63, 163, 122, 0.8); border-radius: 10px; background: rgba(63, 163, 122, 0.06);">
 <h2 style="margin: 0 0 10px; font-size: 14px; letter-spacing: 0.1em; text-transform: uppercase;" id="key-takeaways">Key Takeaways</h2>
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  <li style="padding: 6px 0 6px 26px; position: relative;"><span style="position: absolute; left: 0; color: #3fa37a; font-weight: bold;">✓</span><strong>AAVE: 3.7% earnings yield, -1.0% holder yield</strong></li>
  <li style="padding: 6px 0 6px 26px; position: relative;"><span style="position: absolute; left: 0; color: #3fa37a; font-weight: bold;">✓</span><strong>JUP: 3.5% earnings yield, -2.6% holder yield</strong></li>
  <li style="padding: 6px 0 6px 26px; position: relative;"><span style="position: absolute; left: 0; color: #3fa37a; font-weight: bold;">✓</span><strong>Aave bought 205,000 AAVE in ten months</strong></li>
  <li style="padding: 6px 0 6px 26px; position: relative;"><span style="position: absolute; left: 0; color: #3fa37a; font-weight: bold;">✓</span><strong>Litterbox Trust has burned about 134 million JUP</strong></li>
 </ul>
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<p>Grayscale head of research Zach Pandl set out both measures in an <a href="https://www.grayscale.com/the-stack/bringing-rigor-to-crypto-asset-valuations" rel="noopener noreferrer nofollow">October 21 note on crypto valuations</a>.</p>
<h2 id="earnings-are-positive-holder-yields-are-not">Earnings are positive, holder yields are not</h2>
<p>Grayscale’s adjusted earnings yield divides a protocol’s earnings by its circulating market value, then subtracts the rate at which circulating supply grew. Its tokenholder yield counts only what reaches holders: staking rewards plus buybacks, minus new issuance, divided by circulating market value. Earnings here means fees left after paying lenders, liquidity providers and other suppliers.</p>
<p>Both measures subtract supply growth, so the gap between them approximates earnings that stayed with the protocol instead of reaching holders, as long as Grayscale’s issuance figure tracks circulating-supply growth. A negative tokenholder yield also means, by Grayscale’s formula, that new issuance outweighed buybacks and staking rewards combined.</p>
<div style="display: flex; flex-wrap: wrap; gap: 12px; margin: 24px 0;">
 <div style="flex: 1 1 240px; border: 1px solid rgba(128, 128, 128, 0.3); border-radius: 10px; overflow: hidden;">
  <p style="margin: 0; padding: 10px 16px; font-weight: bold; border-bottom: 2px solid #3fa37a; background: rgba(63, 163, 122, 0.08);">AAVE</p>
  <div style="display: flex; justify-content: space-between; padding: 9px 16px; border-bottom: 1px solid rgba(128, 128, 128, 0.2);">
   Adjusted earnings yield<strong>3.7%</strong>
  </div>
  <div style="display: flex; justify-content: space-between; padding: 9px 16px; border-bottom: 1px solid rgba(128, 128, 128, 0.2);">
   Tokenholder yield<strong>−1.0%</strong>
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  <div style="display: flex; justify-content: space-between; padding: 9px 16px;">
   Gap<strong>≈ 4.7 points</strong>
  </div>
 </div>
 <div style="flex: 1 1 240px; border: 1px solid rgba(128, 128, 128, 0.3); border-radius: 10px; overflow: hidden;">
  <p style="margin: 0; padding: 10px 16px; font-weight: bold; border-bottom: 2px solid #3fa37a; background: rgba(63, 163, 122, 0.08);">JUP</p>
  <div style="display: flex; justify-content: space-between; padding: 9px 16px; border-bottom: 1px solid rgba(128, 128, 128, 0.2);">
   Adjusted earnings yield<strong>3.5%</strong>
  </div>
  <div style="display: flex; justify-content: space-between; padding: 9px 16px; border-bottom: 1px solid rgba(128, 128, 128, 0.2);">
   Tokenholder yield<strong>−2.6%</strong>
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  <div style="display: flex; justify-content: space-between; padding: 9px 16px;">
   Gap<strong>≈ 6.1 points</strong>
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<p style="margin: -12px 0 24px; font-size: 13px; opacity: 0.75;">Source: Grayscale, chart accompanying its October 21 note.</p>
<h2 id="aave-s-buybacks-refill-a-reserve-that-pays-out-aave">Aave’s buybacks refill a reserve that pays out AAVE</h2>
<p>Aave began buying AAVE on the open market in April 2025. Its <a href="https://aave.com/docs/ecosystem/aave" rel="noopener noreferrer nofollow">official documentation</a> lists a $50 million annual budget, with weekly purchases of $250,000 to $1.75 million executed by the Aave Finance Committee. The DAO’s <a href="https://governance.aave.com/t/aave-dao-funding-insights/24192" rel="noopener noreferrer nofollow">funding report</a> says the program acquired more than 205,000 AAVE, about 1.28% of total supply, in its first 10 months.</p>
<p>Aave does not burn the tokens it buys. They go to the Aave DAO Ecosystem Reserve, which pays <a rel="noopener noreferrer nofollow">staking</a> rewards, grants and service providers, so AAVE taken off the market can return to circulation. That may help explain how a sustained buyback program sits beside a negative tokenholder yield.</p>
<p>Operating costs draw on the same revenue. A <a href="https://governance.aave.com/t/arfc-buyback-program-budget-adjustment/24229" rel="noopener noreferrer nofollow">March governance proposal</a> sought to cut the buyback budget to $30 million. It cited borrow-fee revenue about 25% below its peak, January 2026 revenue of $7.95 million against $13.5 million a year earlier, and an optimistic 2026 operating budget of $190 million against 2025 revenue of $142 million. The proposal also made the case against bigger buybacks: spending on GHO stablecoin liquidity and growth could return more to holders than repurchases.</p>
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<h2 id="jupiter-spends-half-its-onchain-revenue-on-jup">Jupiter spends half its onchain revenue on JUP</h2>
<p>Jupiter’s <a href="https://docs.jup.ag/user-docs/more/jup-token/transparency" rel="noopener noreferrer nofollow">transparency page</a> says 50% of onchain revenue has gone to the Litterbox Trust since February 2025, which buys JUP through automated onchain purchases. The trust operates as a long-term reserve and has burned about 134 million JUP. The other half of onchain revenue and all offchain revenue fund the team’s operations, with any excess going to treasury reserves.</p>
<p>In Grayscale’s figures, those purchases and burns have not kept pace with new JUP entering circulation. The note names token unlocks alongside issuance as sources of dilution, which makes Jupiter’s unlock schedule the other half of the JUP picture.</p>
<p>Ordinary holders sit below the published figure. JUP holders receive no direct share of protocol fees, and Active Staking Rewards go quarterly to stakers based on time-weighted stake. Under Jupiter’s <a href="https://docs.jup.ag/user-docs/more/jup-token/tokenomics" rel="noopener noreferrer nofollow">tokenomics rules</a>, locked team tokens cannot earn them. Because Grayscale’s tokenholder yield includes staking rewards, anyone holding JUP or AAVE without staking earns less than it shows.</p>
<h2 id="burns-remove-tokens-for-good-minus-new-minting">Burns remove tokens for good, minus new minting</h2>
<p>A burn is the one destination that cannot pay tokens back out, though minting can still eat into it. PancakeSwap’s <a href="https://blog.pancakeswap.finance/articles/september-cake-burn-report" rel="noopener noreferrer nofollow">September burn report</a> puts numbers on that offset.</p>
<div style="display: flex; flex-wrap: wrap; align-items: center; justify-content: center; gap: 10px; margin: 22px 0; padding: 14px; border-top: 1px solid rgba(128, 128, 128, 0.3); border-bottom: 1px solid rgba(128, 128, 128, 0.3); text-align: center;"><span style="padding: 8px 14px; border-radius: 999px; border: 1px solid rgba(63, 163, 122, 0.7);"><strong>2,963,567</strong> CAKE burned</span><br><span style="font-size: 20px; font-weight: bold;">−</span><br><span style="padding: 8px 14px; border-radius: 999px; border: 1px solid rgba(128, 128, 128, 0.6);"><strong>652,564</strong> CAKE minted</span><br><span style="font-size: 20px; font-weight: bold;">=</span><br><span style="padding: 8px 14px; border-radius: 999px; border: 2px solid #3fa37a; background: rgba(63, 163, 122, 0.1);"><strong>2,311,003</strong> CAKE net cut</span>
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<p>Minting offset about 22% of the burn. The report excludes mints tied directly to burning and spreads weekly burns across reporting months. According to PancakeSwap’s <a href="https://docs.pancakeswap.finance/protocol/cake-tokenomics" rel="noopener noreferrer nofollow">tokenomics documentation</a>, minted CAKE funds farms, the lottery and ecosystem growth.</p>
<p>Hyperliquid burns without a matching mint on this side. Its <a href="https://hyperliquid.gitbook.io/hyperliquid-docs/trading/fees" rel="noopener noreferrer nofollow">fee documentation</a> says the Assistance Fund converts allocated trading fees into HYPE and burns them. Hyperliquid has since added <a href="https://coindoo.com/hyperliquids-usdc-yield-starts-funding-hype-buybacks/" rel="noopener noreferrer nofollow">reserve-income funding to its buyback model</a>, which raises the money available for purchases without itself showing how much was bought.</p>
<h2 id="three-disclosures-that-will-test-these-numbers">Three disclosures that will test these numbers</h2>
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 <table style="width: 100%; min-width: 520px; border-collapse: collapse; text-align: left; font-size: 15px;">
  <thead>
   <tr>
    <th style="padding: 10px 12px; border-bottom: 2px solid #3fa37a;" scope="col">What to watch</th>
    <th style="padding: 10px 12px; border-bottom: 2px solid #3fa37a;" scope="col">Where it appears</th>
    <th style="padding: 10px 12px; border-bottom: 2px solid #3fa37a;" scope="col">Timing</th>
   </tr>
  </thead>
  <tbody>
   <tr>
    <th style="padding: 10px 12px; border-bottom: 1px solid rgba(128, 128, 128, 0.3);" scope="row">Aave’s buyback budget and executed purchases</th>
    <td style="padding: 10px 12px; border-bottom: 1px solid rgba(128, 128, 128, 0.3);">Aave governance forum, TokenLogic dashboard</td>
    <td style="padding: 10px 12px; border-bottom: 1px solid rgba(128, 128, 128, 0.3);">As budget proposals are voted on</td>
   </tr>
   <tr style="background: rgba(63, 163, 122, 0.06);">
    <th style="padding: 10px 12px; border-bottom: 1px solid rgba(128, 128, 128, 0.3);" scope="row">JUP unlocks against Litterbox buys and burns</th>
    <td style="padding: 10px 12px; border-bottom: 1px solid rgba(128, 128, 128, 0.3);">Jupiter transparency page, Litterbox Trust wallet</td>
    <td style="padding: 10px 12px; border-bottom: 1px solid rgba(128, 128, 128, 0.3);">Alongside each quarterly staking reward round</td>
   </tr>
   <tr>
    <th style="padding: 10px 12px;" scope="row">CAKE net supply change</th>
    <td style="padding: 10px 12px;">PancakeSwap monthly burn report</td>
    <td style="padding: 10px 12px;">The October report</td>
   </tr>
  </tbody>
 </table>
</div>
<p>If Grayscale updates its chart, a narrower gap between the two yields would show more of AAVE’s and JUP’s earnings reaching holders, while a wider one would point to supply growth or retained spending absorbing more of them.</p>
<p style="text-align: center; font-size: 14px; opacity: 0.75;"><em>This article is provided for informational purposes only and does not constitute financial or investment advice. Research yield estimates are not guaranteed payouts or forecasts of token-price performance.</em></p>
<p>The post <a href="https://coindoo.com/aave-and-jup-buybacks-arent-keeping-up-with-new-supply/" rel="noopener noreferrer nofollow">AAVE and JUP Buybacks Aren’t Keeping Up With New Supply</a> appeared first on <a href="https://coindoo.com" rel="noopener noreferrer nofollow">Coindoo</a>.</p>

AAVE and JUP Buybacks Aren’t Keeping Up With New Supply

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