Grayscale: AAVE undervalued, could hit $175 within a year

Cryptocurrency asset manager Grayscale said in a report on June 16 that Aave's AAVE token is undervalued relative to the protocol's revenue and cash flow, projecting it could rise to around $175 within a year. The report, titled "A Guide to Buying the Dip: Valuing Crypto Using Cash Flows," noted that while Aave has been a stable DeFi project with transparent financials, it recently faced challenges from the departure of core developers and deposit outflows. Despite these issues, Grayscale expects Aave to generate approximately $60 million in revenue this year. Using a Discounted Cash Flow (DCF) model, the report estimates AAVE's fair value to be between $80 and $100. The $175 price target is based on a scenario where increased regulatory clarity accelerates the adoption of tokenized assets. The report also identified Hyperliquid (HYPE), Uniswap (UNI), Sky (SKY), and Maple (MPL) as other projects with relatively high investment value based on similar valuation metrics.