I (Chris Reilly) have never been much of a crypto guy.

I still own some bitcoin (BTC) after my “Free Ride” last year, and I've dabbled in Ethereum (ETH). A couple of years ago, I even tried a meme coin or two. Let's just say I got burned and decided that was enough of that.

That's partly because I think about investing in stocks a certain way. I like great businesses. Real customers, real revenue, a reason to believe the business can keep growing.

I don't buy junk stocks because somebody says they have a lot of upside. So why would I treat crypto any differently?

That's what caught my attention in Stephen McBride's latest research inside Venture.

• For the first time in crypto's history, Stephen says there are dozens of growing crypto businesses with real customers paying real money.

He believes those businesses will lead the market higher.

As he put it: "The speculative junk isn't coming back."

That may be one of the most important things to understand about where crypto is headed.

And if you think about crypto that way... as a market with real businesses starting to thrive...  you can ask the same questions you'd ask about any stock.

Who is the customer? How much money does the business make? And much money comes to you, as an investor?

Stephen has spent a lot of time answering those questions.

As we showed you on Friday, he built a model tracking 1,362 crypto businesses, mapping what each one earns, how fast it's growing, and how much of that money reaches the people who own its token.

• Take Hyperliquid (HYPE). 

It's a crypto derivatives exchange generating roughly $713 million in annual revenue. Stephen says essentially all of that revenue goes toward buying HYPE on the open market, similar to a buyback in the stock market.

That quality gives cryptos like HYPE a life of their own. Generally speaking, for all of cryptos history, prices have followed bitcoin. When bitcoin rose, all of crypto rose. When bitcoin fell, it was hard to find a crypto that bucked the trend. 

HYPE and other business cryptos have broken that pattern.

Stephen recommended HYPE inside Venture last September. Bitcoin has fallen about 25% since then. HYPE has gained over 60% in the same time frame, despite the bitcoin headwinds. If bitcoin has bottomed as Stephen believes, that’s now turning into a tailwind.

Then there's GEODNET (GEOD), a satellite-positioning network generating around $10 million a year. About 80% of its revenue buys back GEOD tokens.

There’s also Render Network (RENDER), which operates a GPU marketplace and routes nearly all of its revenue to token holders through its buyback-and-burn mechanism.

• But just because a crypto business makes money doesn't mean you make money when you own its token.

With a stock, the ownership claim is straightforward. A company earns money and shareholders have a legal claim on the business. Crypto can be much messier. A protocol might generate millions in fees while its token holders receive nothing.

Crypto users paid roughly $28 billion in fees over the past year. Only about $3 billion made its way to token holders. Eleven cents on every dollar.

That's why Stephen separates crypto businesses into those that actually pay their owners and those that don't. The market is already rewarding the payers. Since the July bottom, the typical crypto business that pays its token holders is up 87%. The typical one that pays nothing is up 52%.

But the most interesting part is what comes next.

Some protocols have the machinery to send revenue to token holders, but haven't turned it on yet.

• Stephen calls it being able to "flip the switch."

Many cryptos haven’t begun paying users for legal reasons. For years, paying token holders risked the SEC flagging a crypto as an unregistered security. That's changing.

In August, the SEC proposed a 400-page rulebook for crypto that includes a "safe harbor" provision... essentially a path that could allow mature protocols to start sharing revenue with much greater regulatory clarity.

Some cryptos have decided to flip the switch and take the regulatory risk. When Uniswap (UNI) flipped its fee switch, the token rose 153% from its low. When Ethena (ENA) began sharing its revenue with token holders last month, its token surged 70% in 30 days.

• Now think about the protocols that have real revenue, have the mechanism built, and are just waiting for regulatory clarity to pull the trigger.

Stephen believes that group is badly mispriced right now. They’re the cryptos he wants to own.

For years, the crypto conversation was dominated by questions like: What's the next hot narrative? What meme coin could 10X?

In Venture, Stephen asks: Which businesses are actually making money? Which ones are growing? And which ones are structured so their investors actually participate in that success?

That's what Stephen is doing inside Venture every month. Right now, the portfolio has 12 names. And Stephen just shared his top three Best Buys.

If you want Stephen's full portfolio, his monthly screen of the entire crypto revenue landscape, and his calls on which switches are about to flip, click here to consider a discounted membership to Venture before the offer expires.

Chris Reilly Executive Editor, RiskHedge