Lou Kerner is a Founding Partner of CryptoOracle. He is recognized as one of the most influential crypto bloggers. At one point in his storied career, he was an angel investor, best known for investing in Facebook and writing the first Wall Street style research report on the company in 2010. We recently sat down with Lou, who will be providing the keynote luncheon address at our Digital Asset Strategies Summit (Oct. 16 – 17 – Dallas), as he shared his thoughts on the economic impact of tokenizing private assets.
Digital Asset Strategies Summit: Bringing liquidity to private assets through tokenization will undoubtedly affect private company valuations. Where do you see valuations of emerging growth companies headed as a result? How do you think the tokenization of private equity will impact the venture capital industry?
Lou Kerner: Depending on the asset, liquidity should provide 10%-20% increase in value.
Liquidity will also significantly increase the amount of capital committed to PE or VC, because no liquidity is a deal stopper for the majority of global capital.
Digital Asset Strategies Summit: What do you predict the economic impact of tokenizing private or illiquid assets could be?
Lou Kerner: Tokens are a new asset class, similar to how junk bonds used to be. When they come out they are shiny, they are volatile, and they are shunned by most of the traditional world. Over the next 7-10 years, I think Security Token market cap will top $10 trillion.
Digital Asset Strategies Summit: Can you discuss how tokenizing private ownership will enable the scalability of fractional ownership? How will this impact cap tables?
Lou Kerner: Ownership of things that people want to own, like art, or sports teams, can easily be fractionalized in a token world, bringing liquidity and massively increasing the pool of potential owners.
Digital Asset Strategies Summit: Why do you see digital assets as the golden age of securities innovation?
Lou Kerner: It’s the beginning of a brand new Medium, like TV was at some point. We’ll use these new tools to design securities that blow people’s mind.
Digital Asset Strategies Summit: It seems like Wall Street is eager to embrace blockchain, yet many influential names on the Street are negative on bitcoin. Why do you think so many conventional players are having trouble “seeing the crypto light”?
Lou Kerner: I wrote an article “The Top 10 Reasons People Can’t See The Crypto Light”” For people on Wall street, I think success is an impediment to seeing the light.
Digital Asset Strategies Summit: Thanks Lou. We look forward to hearing more of your thoughts at the Digital Asset Strategies Summit October 16 – 17 in Dallas.