Delphi Digital analysts have renewed a debate over whether crypto tokens and company equity can share value without creating conflicting claims.
Summary
- Delphi analysts said equity usually captures company profits, limiting the value available to associated tokens.
- Projects can use vague token-equity boundaries to support valuations exceeding economic rights granted to holders.
- Buybacks, burns and fee sharing can connect token value to revenue, but execution remains project-specific.
During a July 15 roundtable, analyst Ceteris said token market capitalisations should usually remain below the value assigned to the related company because equity holders normally receive most business profits.
Delphi released the discussion under the title “Are Crypto Tokens Fundamentally Broken?”. The episode covered Grass, Venice and other projects where a private company operates alongside a publicly traded token.
Equity carries clearer rights to company profits
Equity gives shareholders an ownership interest in a company. Investor.gov states that stock represents a proportional claim on a corporation’s assets and profits. Common shareholders may also vote on company matters and receive dividends when directors approve them.
A crypto token may carry different rights. Some provide network access, rewards or governance votes. Others support staking, fee discounts or payments. Holding a token does not automatically give its owner a legal claim on company revenue, assets or sale proceeds. The rights depend on the project’s documents, contracts and legal structure.
Ceteris argued that this difference should restrain token valuations when a project also has equity investors. He said most “actual cash profits” ultimately flow to shareholders. The token’s market capitalisation “should generally be smaller” unless the project has a clear system that sends value to holders.
Ambiguity can support inflated token valuations
Ceteris said problems arise when projects leave the boundary between tokens and equity unclear. A company may market the token as the centre of an ecosystem while keeping revenue, intellectual property, customer contracts and sale rights inside the equity entity. Token buyers may then price the asset as though it captures the full business.
This setup creates groups with different interests. Equity holders may want the company to retain profits, raise capital or pursue a sale. Token holders may prefer fee sharing, buybacks, burns or stronger onchain governance. Management must decide which side receives value from the product.
The Delphi episode used Grass and Venice as examples. It did not claim every dual structure will fail. The speakers focused on whether projects disclose where revenue goes and whether token holders have enforceable or programmatic economic rights.
Governance alone may not solve the issue. As crypto.news explains in its governance-token guide, holders can vote on protocol proposals, but each project defines what those votes control. A token may govern incentives or technical updates without controlling the company that owns key software and commercial agreements.
Strong markets can hide structural weakness
Delphi Digital co-founder Yan Liberman said tokens may still perform when market conditions remain strong. Rising liquidity can lift prices even when a token’s link to revenue remains limited. Traders may focus on user growth, listings or market narratives instead of cash-flow distribution.
However, Liberman said the structure can weaken when business conditions deteriorate or shareholders seek an exit. A sale may transfer the operating company, brand or intellectual property to a buyer while leaving token holders outside the deal. The outcome depends on agreements linking the company and network.
The risk can also emerge when revenue falls. Equity investors hold formal claims within the corporate structure, while token support may depend on company decisions or governance votes. A project can reduce incentives, delay buybacks or change utility unless binding rules prevent those changes.
Equity also carries risks, including dilution, bankruptcy and operating losses. Tokens may offer global liquidity and transparent onchain systems. Delphi’s argument centred on pricing those different rights accurately rather than treating both assets as equal claims.
Projects test clearer token value accrual
Several crypto projects now use revenue-linked systems to narrow the gap. Buybacks use protocol income to purchase tokens. Burns permanently remove tokens from circulation. Fee sharing sends part of network revenue to eligible participants. Each model creates a clearer connection between activity and token economics.
As crypto.news reported, Hyperliquid has routed trading revenue into HYPE purchases through its Assistance Fund. The mechanism had used more than $1.16 billion in fees for token purchases by May 2026.
Meanwhile, Jito proposed using DAO revenue for JTO buybacks and permanent burns. The proposal would direct its share of JTX revenue toward the token mechanism through at least the fourth quarter of 2027.
Similarly, Uniswap’s fee programme converts protocol income into UNI burns across supported networks. The system links protocol fees with token supply reduction instead of sending dividends directly to holders.
These systems do not turn tokens into equity. Holders may still lack claims on company assets, dividends or acquisition proceeds. Still, automated and disclosed mechanisms make token demand easier to measure through revenue, buyback volume, supply changes and governance controls.
The Delphi roundtable called for lower expectations when those links remain weak. Its central test asks which asset receives the cash generated by the business. When equity captures income and the token relies mainly on market demand, assigning both similar valuations may overstate the token’s economic position.
