An increase in fees on some of the most widely used DeFi applications is a sign that traders are returning to fundamentally strong projects.
September revenues jumped to about $600 million, nearly double the low of $340 million recorded in March. Uniswap, the decentralized exchange that remains the largest cryptocurrency trading platform, and Aave, the lending and borrowing protocol, are driving much of this rebound. Synthetic dollar project Ethena joined them among the biggest earners, according to The Block Research.
What’s different now is how protocols are trying to bring importance back to token design and actively redirect value back to holders.
On Uniswap, governance earlier this year approved $165 million in new foundation funding this year while explicitly laying the groundwork for the long-debated “fee shift” – a mechanism that would direct a portion of trading revenue to UNI holders once version 4 rolls out on Unichain.
Aave went in a different direction. DAO service providers offer a framework that channels excess revenue into regular redemptions and the ecosystem reserve, replacing one-time cash flow adjustments with an ongoing accrual policy.
The goal is to recycle revenue into AAVE and tighten the connection between token usage and performance. This mechanism has already been activated as fee growth has accelerated this year.
The Ethena model is simpler. Its USDe and sUSDe system transformed fees into yield, distributing them directly to holders as the total value locked increased.
Dashboards now place Ethena among the top generators of distributable revenue in DeFi, a position bolstered by integrations with Aave and yield trading app Pendle that funnel more activity into its stablecoin engine.
These projects’ tokens have performed in line with market trends but have not outperformed so far, but traders may want to keep an eye on Uniswap’s UNI, Aave’s AAVE, and Ethena’s ENA.
Although they are not stocks, the underlying fundamentals and fee increases give trading desks a framework to value them beyond just vitality.
Questions about sustainability remain, however. Is the fee line valid if volumes decline or token holder distribution is diluted by cash flow priorities? Or does the next hype cycle shift the focus back to memes?
