Yuval Rooz has a blunt message for the smart contract sector: If you claim to be the future plumbing of global finance, you’d better show the cash flow.

“People have assigned a lot of value to these networks based on what they say they’ll become,” said Rooz, CEO of Digital Asset and co-founder of the Canton Network. “But when you look at how much actual business they’re doing, there’s a massive disconnect.”

The Canton Network is a privacy-enabled blockchain infrastructure that aims to connect financial institutions and their tokenized assets across interoperable, permissioned applications.

“The issue isn’t about any single chain. Many smart contract networks were architected for retail speculation and token trading, not for regulated, institutional financial workflows,” Rooz told CoinDesk in an interview.

“When you look at metrics like sustained economic throughput, recurring revenue, and real-world asset activity, there’s often a disconnect between valuation and actual financial usage. Building infrastructure for global institutions requires a very different design philosophy around privacy, compliance, and interoperability,” he said.

Rooz, who previously worked at DRW and Citadel before founding Canton, said he isn’t anti-crypto. He drew a distinction between assets like bitcoin BTC$67,306.42, which the market values as a store of value or digital gold, and smart contract platforms that promise to transform financial infrastructure.

“Gold and silver have value because the market assigns it to them,” according to Rooz. “Bitcoin is an asset class. But smart contract networks pitch themselves as the next set of financial rails. If that’s the pitch, then financial institutions should be using them at scale.”

In his view, most aren’t.

“If you’re processing very small amounts of value on your network, how does the market assign you a $10 or $11 billion valuation?” he said, citing large-cap chains that see limited real-world financial throughput. “At the end of the day, it’s a memecoin. It’s not solving the problem it said it would solve.”

A speculative design flaw

Rooz argued the gap stems partly from token design. Many networks copied bitcoin’s issuance model, minting tokens to reward validators, even though bitcoin is an asset secured by miners, not a programmable platform meant to host financial applications.

“Bitcoin is an asset class, not a platform,” he said. “People who secure the asset class get paid. Everyone copied that model for smart contract chains, and that was a mistake.”

On many networks, newly minted tokens flow primarily to validators, regardless of whether the chain is generating meaningful economic activity. If usage is thin, inflation dilutes holders while little value accrues back to the token.

By contrast, Rooz said Canton’s token is designed to reflect the dollar utility of the network itself. Every transaction burns tokens, and there are no priority or front-running fees. If usage grows in dollar terms, more tokens leave circulation.

“If you believe the USD utility of the network will continue to increase, more tokens will go out of circulation and the price should go up,” he said.

Canton also features a “mint curve,” with new tokens issued at regular intervals. But those tokens aren’t reserved only for validators. They’re distributed to users and applications that generate fees on the network.

“Compensating builders should be merit-based,” Rooz said. “Can you bring customers? Can you generate fees? That’s how you get paid.”

He pointed to Hyperliquid as an example of a model that resonates with investors: the trading platform generates revenue and uses it to buy back tokens. “When you do buybacks, price goes up. That’s a much more convincing reason to hold a token,” he said.

In other words, value must flow.

Digital Asset, the company behind Canton, said in December that it had secured strategic investments from four major traditional financial players. Investors in the round were BNY, a financial services firm overseeing $57 trillion in client assets, exchange operator Nasdaq, financial intelligence firm S&P Global and iCapital, a fintech firm backed by BlackRock, Blackstone and JP Morgan.

Bloomberg recently began publishing data related to activity on Canton, and the Depository Trust & Clearing Corporation (DTCC), the industry-owned clearing and settlement market infrastructure, said in December that it had selected the network as its tokenization partner, in a sign of growing institutional traction.

The limits of TVL

Rooz is equally skeptical of total value locked (TVL) as a headline metric.

“TVL is a very bad metric in isolation,” he said. “What matters is usage.”

Canton’s design emphasizes configurable privacy for institutional participants, and in turn, much of the network activity isn’t publicly broadcast. That makes traditional DeFi-style dashboards incomplete.

Because transactions can remain confidential, “we rely on participants to publish information about what they’re doing onchain,” Rooz said.

Still, some data points are emerging. Broadridge, a financial infrastructure provider, processes roughly $400 billion in repo transactions daily on Canton, according to Rooz. Other projects on the network handle comparable volumes, he said.

The network is now generating between $2.5 million and $3 million in daily fees, Rooz said, with ambitions to double that.

“If a company had bylaws saying any profit it makes will be used to buy back stock, and performance keeps going up, the share price should go up,” Rooz said. “A decentralized network should be treated the same way. Look at revenue. Look at growth.”

A coming reckoning

The broader market, he said, is starting to apply that lens.

“When the market is good, money flows into memes and speculative tokens,” Rooz said. “When the market turns, investors get much more demanding.”

Many altcoins that marketed themselves as smart contract platforms have been eviscerated during recent downturns, he noted. Meanwhile, tokens tied to revenue-generating platforms have fared better.

For Rooz, this signals a shift toward what he calls a more “rational economic structure.”

“Crypto has defied the laws of gravity for some time,” he said. “But eventually gravity wins.”

Stablecoins and product-market fit

Even stablecoins, often hailed as crypto’s breakout use case, haven’t fully crossed the chasm in Rooz’s view.

“Stablecoins haven’t hit product-market fit yet,” he said. “You can say stablecoins have product-market fit when more than 50% of usage is not crypto-related.”

Today, he argued, much of stablecoin demand is driven by crypto trading and onchain speculation. Real-world payments and non-crypto financial applications remain a minority of activity.

Canton’s strategy is to push deeper into traditional finance, bringing real-world assets and collateral onchain. The network recently announced gold-related initiatives and plans additional non-crypto collateral integrations.

The goal is straightforward: move beyond crypto-native assets and into mainstream financial workflows.

“If smart contract chains are the next set of financial rails, then financial companies should be using them for financial applications,” Rooz said. “Uptake, activity and usage; the value will follow.”

As for where Canton’s token price goes from here?

“If you’re chasing token price, you’re chasing the wrong thing. Focus on utility. Focus on building real financial infrastructure.”

The rest, he suggested, is gravity.

Canton coin (CC) was trading around $0.1538 at publication time. The token has risen about 2% year-to-date, outperforming wider crypto markets. The token currently has a market cap of roughly $6 billion.

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