The way that I am interpreting this is that if I were to invest in one of these (i.e. Maker) then the returns that I would see are there purely because other people are investing in it.
That is close to what most stocks do, but at least with stocks in a company the value is not driven by the mechanism by which it is traded alone, but also by the decisions and profitability that the stocks are backing.
That's the opposite of what I'm saying. The returns are from other people using the platform, not from investors in it. For Maker, using the platform means borrowing. For Uniswap, the returns are from a small % fee on trades. It's exactly analogous to a traditional company.
This is essentially the "problem" at heart of all crypto "currencies". There is no real world use case that imparts human value, apart from its utility as a speculative vehicle to grow wealth.
Every new DeFi application is a new layer to lock in current adapters who would've otherwise already cashed out. Crypto as a currency is a concept dead in the water because of the perverse incentives of finding every corner of arbitrage between non distinguishable (and frankly worthless) alt tokens/coins.
The entire world of crypto is nothing else but an experiment of how much one could financialize a fully non-regulated, intangible, and imaginary "good" based on nothing but greed.
If it was a ponzi scheme they would be spending millions on advertising and use fear of missing out to get more people to invest.
Wait....
But what is the value of the protocol?
> actually returning profits
Are there actually profits if the protocol is worthless?
Wish I knew! Investing would be a lot easier.
> Are there actually profits if the protocol is worthless?
Nope, therefore these protocols are not worthless?
That's misleading. Revenue is not earnings. For something like Uniswap, you also have to look at how much of earnings is given to liquidity providers versus spent on token buybacks.
For example crypto.com offers 12% pa. on your USD account.
P/E just like normal company ...
Oh course their are subtle details that cause volatility and risk of collpase based on how the company/bank/borrower uses the money you put in.
And it is not loan, it is a "stake".
An example of the mumbojumbo obvious fraud that is out there.
It has nothing to do with a company making money by producing useful products or services that has actual real world value.
Staking is just a very stupid loan that you give out without having any real insight into the people who borrowed from you.
Interestingly, this isn't really true anymore. Most of the newer defi currencies represent a portion of ownership in some protocol that is actually returning profits.
E.g. Maker is a lending platform for DAI. You can borrow DAI by depositing other currencies as collateral. The interest you pay to borrow is then converted by Maker into a sort of "stock buyback" against its Maker token.
The Maker token has a P/E ratio, as do many other coins. https://www.tokenterminal.com/
To your point though, the P/E ratio for most of these is denominated in other cryptocurrencies, not in USD.