Crypto token buybacks hit record $640M, but the market barely notices

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The cryptocurrency protocols have reportedly spent an all-time high of $640 million on crypto token buybacks. This indicates that this once-niche financial tool has made its way into the mainstream treasury strategies. However, the question emerges of whether this effort is actually helping to stabilize the pricing. Up to this point, it appears that the answer is no.

What started off as a sub-strategy utilized by select high-revenue protocols has reached base layer chains and top DeFi protocols and is progressively impacting the approach of investors in valuing tokens and protocol cash flows.

From $40 million a week to billions a year

The figures were much lower a year before. August 2025, weekly repurchases of protocols were around $40 million, where Hyperliquid’s share was about $24 million and memecoin launchpad Pump contributed $10 million. The concentration indicated that the first repurchasers were actually only a few platforms that were able to earn a good amount of fees.

According to CoinGecko data, protocols ended up buying back over $1.4 billion of their tokens throughout 2025.

Tokenomist gives greater details. The total volume of buybacks and burns by 27 active tokens during the period from January 2025 to July 2026 amounted to approximately $18.8 billion. Of this total, burns accounted for more than 80% while buybacks (including initiatives like HYPE and PUMP) amounted to almost $2.8 billion.

Why does the buying pressure keep losing?

Although the money is real, the price support doesn’t always match. Several tokens with an active buyback program remained stagnant or decreased through 2025, making one ponder just how effective buybacks really are.

The Block conducted a survey with analysts who identified an inherent problem of scaling. “Token buybacks create way less demand than there is selling pressure,” stated Lex Sokolin, co-founder of Generative Ventures. He went on to explain that the token buyback program, amounting to $100 million each year, does not matter in light of $20 million being traded daily.

Amir Hajian, an investigator from Keyrock, claims that unlocks, together with constant emissions, can undermine the demand for buyback. Rob Hadick of Dragonfly stated that if selling exceeds buying, market prices will fall.

Also, there is a difference in structure compared to equity. As explained by Hajian, most of the holders of tokens have nothing legal to get from the cash flow of the protocol through these tokens. While tokens that are used up may decrease the amount of floating tokens. They don’t actually concentrate ownership in the way it occurs with the buyback of corporate stock.

Who is actually shrinking supply?

Spending on buybacks also does not necessarily reduce token supply.

Tokenomist investigated 11 initiatives featuring clean on-chain data and discovered that only a few of them have a practice of permanently removing tokens. Hyperliquid burns the repurchased HYPE token, as Pump.fun also burns its PUMP token after it is bought back. Jupiter puts the repurchased tokens in a trust. Meanwhile, Aster returns them to stakers. So, neither Jupiter and Aster actually reduces circulating token supply.

Tokenomist’s investigations suggest that among new emission tokens, the only ones to have undergone an actual reduction in their respective supplies are BNB and RAY.

The biggest programs have continued to be major players. Hyperliquid uses roughly 99% of its more than $800 million in yearly revenue to buy and burn HYPE, having already removed around $1.3 billion from circulation since it started its operations in November 2024, per a Bitwise memo discussed by Cryptopolitan.

Pump.fun invests half of each dollar earned in buying back and burning PUMP. The platform states that $442 million worth of the token has already been burned, making up more than 16% of its total supply.

The model spreads to blue-chip DeFi

The strategy is now spreading across major DeFi projects. Uniswap’s December 2025 “UNIfication” vote activated protocol fees and burned about $590 million of UNI in one move. Aave has also begun retiring roughly $30 million of AAVE annually under Aavenomics 3.0.

Bitwise CIO Matt Hougan argues that tokens are increasingly being valued on revenue in ways that resemble equities, and that undervalued tokens “could see valuations double or more” if the trend continues.

Nevertheless, the findings remain unclear. An analysis from Cryptopolitan in January indicated that a reduction in supply has not always correlated with increasing prices, where buyback tokens are still in poor market performance.

For investors, massive spending on repurchases may suggest that the crypto business is maturing. However, it is not certain that this will help the token’s price go up.

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