The Four Areas of Crypto Investments
For years, one of the biggest challenges facing digital asset investors has been figuring out what exactly they should own. There are thousands of cryptocurrencies, hundreds of blockchain protocols, dozens of publicly traded companies, and seemingly endless new projects launching every week. Yet despite all these choices, the number of genuinely attractive investments has historically been remarkably small, and shrinking.
We’ve spent much of this year writing about how that is finally changing. The combination of improving fundamentals, better tokenomics, regulatory clarity, and increasing institutional adoption is transforming digital assets from a market dominated by speculation into one where investors can increasingly apply traditional fundamental analysis.
And while the broader crypto market continues to struggle with its identity, we believe the investment opportunity is actually becoming much clearer. In fact, we would argue that there are really only four types of crypto investments worth owning today.
1. Publicly Traded Equities — Own the Companies Building the Industry
The first category is the most straightforward: stocks.
For all the complexity surrounding digital assets, there is nothing particularly complicated about owning equity in a successful business. Companies generate revenues, manage expenses, allocate capital, and hopefully grow earnings and free cash flow over time. Shareholders have a legal claim on the residual value of these businesses, and as these businesses become more valuable, their equity should generally follow.
Unfortunately, there still aren’t many great publicly traded crypto companies. Honestly, there aren’t even that many great private companies to own.
We continue to favor companies like Galaxy Digital (GLXY) and Securitize (SECZ), which provide exposure to some of the fastest-growing segments of the digital asset ecosystem. Galaxy offers exposure to institutional trading, asset management, and the rapidly expanding AI data center industry, while Securitize is positioned to benefit from the inevitable migration of traditional financial assets onto blockchain infrastructure (RWA tokenization).
And the universe of investable companies should continue to expand. Kraken is expected to pursue an IPO next year, and we anticipate that many other successful private crypto companies will eventually enter the public markets if crypto IPOs stop going straight down (see COIN, BTGO, GEMI, BLSH).
We’ve written extensively about how traditional financial institutions are moving into digital assets, and as this convergence accelerates, we expect investors will have an increasingly attractive selection of publicly traded companies through which to participate.
But stocks are only one way to capture this growth.
2. Existing Tokens With Real Revenues and Strong Tokenomics
The second category is one we’ve been writing about almost nonstop this year: tokens attached to successful businesses that actually accrue economic value.
For most of crypto’s history, there has been an enormous disconnect between the success of a blockchain protocol or company, and the performance of its token. A protocol or company could generate hundreds of millions of dollars in revenues, attract millions of users, and become an indispensable part of the digital asset ecosystem, while its token provided holders with little more than meaningless governance rights, if that (e.g. LINK, XRP).
This was always ridiculous.
As we’ve argued repeatedly, much of this problem was self-inflicted, driven by misguided legal advice, poorly designed token structures, and a regulatory environment that discouraged projects from creating economically valuable tokens. Fortunately, that is changing.
As we wrote last week (and many, many, many other times), several companies and protocols are demonstrating that tokens can have real economic value through mechanisms such as revenue-funded buybacks, staking benefits, fee distributions, and other forms of value accrual. These projects aren’t simply selling a narrative about what blockchain technology might accomplish someday. They are operating real businesses, generating real revenues, and increasingly creating mechanisms through which tokenholders can participate in that success.
The point is simple. If a protocol is growing revenues, expanding market share, and returning economic value to tokenholders, investors finally have something tangible to underwrite.
But perhaps even more exciting than the projects that have already figured this out are the new projects being built with these principles in mind from day one.
3. New Tokens Designed Correctly From the Beginning
For years, new token launches followed a fairly predictable playbook. Raise money from venture capitalists, launch a token with questionable utility, distribute a small percentage of the supply to the public, and hope that speculation drives the price higher before the inevitable insider unlocks.
It was a terrible model for public market investors, and unsurprisingly, most of these tokens performed terribly. The complicit actions by exchanges like Binance and Coinbase, which listed these new tokens destined to fail, are a big reason why so many retail investors have left crypto for good.
But we’re starting to see a new generation of projects that are doing things differently. Rather than launching tokens as an afterthought or fundraising mechanism, these companies are designing their tokens to be integral to the economics of their businesses from the beginning.
Venice AI (VVV) is an interesting example. Venice provides privacy-focused AI services, allowing individuals and businesses to access leading AI models without surrendering their personal data to centralized platforms. But what makes Venice particularly interesting is its token design. By staking VVV, users receive access to a proportional share of Venice’s AI inference capacity, creating a natural relationship between demand for the company’s services and demand for its token. Venice has also introduced revenue-funded token buybacks and burns, further connecting business activity to tokenholder economics. As demand for private AI inference grows, the economic value of accessing that capacity could grow alongside it. Now, this doesn’t mean that VVV is necessarily attractive at today’s valuations, but it means you can at least take VVV seriously and try to value it on its merits. And it does not require a traditional equity-style dividend to create economic value.
The important point is that VVV and other tokens on the way have a reason to exist beyond speculation. And while it’s too early to know whether Venice will ultimately succeed, this is exactly the type of innovation we want to see from the next generation of digital asset issuers.
4. Old Legacy Tokens Attached to Great Businesses That Can Finally Be Fixed
The fourth category may actually be the most overlooked investment opportunity in crypto today. And ironically, it’s something we’ve been writing about for more than six years.
Back in July 2020, we wrote that one of the most exciting aspects of token investing was the flexibility of token structures. Unlike traditional securities, token issuers could continually modify their economics, introduce new functionality, and create better incentives for tokenholders. We revisited this argument in April 2025, noting that tokenomics and use cases can evolve throughout the lifespan of an asset.
This is one of the most underappreciated characteristics of digital assets. Token economics are not set in stone.
A token that was poorly designed five or ten years ago doesn’t necessarily have to remain a bad investment forever. Supply schedules can be modified. Buybacks can be introduced. Revenue-sharing mechanisms can be implemented. New utility can be created. Of course, these changes require management commitment, community support, and appropriate legal structures, but the flexibility exists.
And this creates a fascinating investment opportunity: finding successful businesses whose tokens have been left for dead, but whose economics can now be completely reinvented.
Take Brave Browser and its Basic Attention Token (BAT), for example.
Brave has more than 120 million users and is reportedly among the 50 most visited websites in the world, alongside companies like Telegram, eBay, Discord, and GitHub. By almost any measure, Brave has built an incredibly successful consumer product.
Yet for nearly a decade, BAT has been largely irrelevant as an investment (and that’s being generous).
The problem wasn’t necessarily the underlying business. It was that BAT had very little connection to the growing economic value of that business. Brave could continue attracting users, building products, and expanding its ecosystem without creating meaningful incremental demand for BAT.
But that may finally be changing.
In July, Brave announced BAT Roadmap 4.0, outlining a series of initiatives designed to make BAT a more integral part of the Brave ecosystem. These include a stablecoin-powered Brave Rewards Card, a unified wallet combining traditional payments and crypto, expanded payment infrastructure through BravePay, and new opportunities involving AI and digital commerce. Most importantly, Brave plans to use a percentage of net revenues generated by wallet services, payments, and other products to repurchase BAT, with those tokens used to fund rewards, creator payments, and ecosystem growth.
The company’s new Rewards Card has reportedly already attracted more than 200,000 waitlist signups in just two months, demonstrating meaningful early interest in these new products. Meanwhile, BAT is fully diluted, meaning investors no longer have to worry about future scheduled token unlocks.
Think about what this means.
Brave has already done the hard part. It has built a product used by more than 120 million people. It has established a globally recognized brand, developed distribution, and created an ecosystem that millions of people interact with every day.
But until recently, there was very little reason for investors to own BAT. Now Brave is attempting to connect the success of its business to the economics of its token.
Of course, there’s no guarantee that these changes will work. Revenue-funded purchases that are subsequently redistributed to users aren’t necessarily equivalent to equity buybacks that permanently reduce supply. And the success of the new payments product remains to be seen.
But that’s precisely why this opportunity is interesting.
Investors may be able to purchase tokens at valuations that reflect years of terrible tokenomics, rather than the economic potential of the businesses behind them. And BAT is unlikely to be the only example.
There are countless crypto projects that have spent years building legitimate products, attracting users, and generating revenues while their tokens have performed terribly. In some cases, the businesses are thriving while the tokens are practically worthless. Moreover, there are tons of non-crypto businesses that have succeeded as well, but can do even better if they introduce a token (think Netflix, Disney, Spotify, Nike and other consumer-facing businesses).
For years, investors correctly avoided these assets because there was no mechanism for tokenholders to benefit from the underlying business. But what happens when those mechanisms are finally introduced? What happens when a token that investors have ignored for five years suddenly becomes economically relevant?
The potential for a dramatic repricing could be substantial.
Looking Ahead — The Investment Opportunity Is Becoming Much Clearer
For much of crypto’s history, investing in digital assets required investors to suspend many of the fundamental principles they applied everywhere else. Worse, most casual observers were duped or smokescreened into thinking fundamental investing wasn’t even possible in crypto.
Revenues didn’t necessarily matter. Earnings didn’t necessarily matter. Valuations were largely meaningless. And the relationship between a project’s success and its token price was often nonexistent.
That is finally changing.
Today, investors have four increasingly attractive ways to participate in the growth of the digital asset industry (and that growth is unmistakably happening in 3 areas – stablecoins/payments, DeFi and RWA tokenization). Investors can now own the equity of successful companies, established tokens with growing revenues and meaningful value accrual, new projects whose tokens are designed around sustainable economic utility from inception, or they can identify successful businesses whose legacy tokens may finally be getting the economic restructuring they deserve.
These opportunities are very different, but they all share one common characteristic: there is an identifiable economic reason why the asset should become more valuable as the underlying business or network succeeds.
And perhaps most importantly, this fourth category reminds us why we’ve always believed tokens have certain advantages over traditional securities. Unlike an equity security, whose basic ownership rights are relatively well established, a token can have an economic design that evolves dramatically throughout its lifespan.
Sometimes that flexibility has been abused. But increasingly, we’re seeing it used to create real economic value. Six years ago, we argued that this flexibility would become one of the most important characteristics of digital asset investing.
It took a lot longer than we expected, but we may finally be seeing that thesis play out.
The next great crypto investment doesn’t necessarily have to be a new company or a new token. It might be an old token attached to a great business that finally figures out how to reward its investors.
Disclosure: The Arca Funds and/or their affiliates hold positions in GLXY, SECZ, Kraken, and BAT discussed in this article.
And That’s Our Two Satoshis!
