By: Patrick O’Meara, Chairman and CEO, Inveniam
We are truly in the midst of a crypto winter. There will be more, we have been through others. The recessionary mind virus over the broader economy has taken hold in the US and is almost prophetic/self fulfilling. This constriction in the capital markets and the crypto winter will drive mass adoption of Digitization. Price Discovery with real time surveillance of private market assets will drive Tokenization with firms like Tokeny. With quarterly marks by third party partners like Cushman & Wakefield, Deloitte, ValuStrat and Houlihan Lokey, in period comps, and observable inputs this will drive better accounting treatment from Level 3 to Level 2 (ASC820, FASB157, IFRS13). This will lead to regulatory capital release, collateralization, and then secondary markets, and new novel forms of primary distribution.
It was a pleasure to spend time this week in Luxembourg and Paris with Tokeny and Euronext. Emilie Rieupeyroux Daniel Coheur Luc Falempin David Leblache. We are laying the foundation for the global trading of private market assets in a digital form. We will see closed end funds and Interval funds tokenized in scale over the next 18 months. The monthly or quarterly price discovery of the assets in these fund will allow new forms of listing on exchanges while meeting the macro trend of transparency. We will see these funds which invest in private market assets listed in the jurisdictions in which they are distributed. They will be listed on ATS like Oasis Pro Markets, Rialto Markets, ADDX, and exchanges like NYSE, Nasdaq, Euronext, and ADX.
It seems like it is spring in the Digital Assets space, we will see significant listing of tokenized funds, this will drive collateralization with players like MakerDAO, Zand, and other banks and non bank lenders, using DeFi structures…lending against alternative assets which have technical or bulletin board listings…We see leadership in Abu Dhabi, Europe, Singapore, and we are locking in new partners in Brazil and India right now. It is an exciting time.