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The CEO of the small, but hugely powerful, advisory boutique LionTree has now set his sights on the world of crypto—and his firm may even launch its very own token, too.
In LionTree’s year-end letter, Aryeh Bourkoff waxed poetic about budding trends like the creator economy, non-fungible tokens (), decentralized finance ( ), and the metaverse.
“In 2021, crypto made itself impossible to ignore, with a market cap at times surpassing $3 trillion,” he wrote. “This was because people with more cash than usual were looking for a place to a) guard their money against inflation (), b) find higher returns (other cryptocurrencies and tokenized assets), and c) ensure higher yields (DeFi).”
He also indicated his firm is “exploring ways to start accepting crypto as payment for [its] services,” going as far as to say LionTree “might even create [its] own LionTree token of trust.”
Though many CEOs in the crypto industry have already penned letters like Bourkoff’s, the arrival of LionTree, a deal-making machine in the traditional world of technology and media, is notable.
The firm helped Amazon acquire MGM studios in July for $4.45 billion, for example. LionTree was also behind the initial public offering for Snap Inc., the popular social media app. It oversaw the merger between WarnerMedia with Discovery Inc., as well.
LionTree sees crypto promise and hurdles
Besides the symptoms of being locked inside with a bit of extra cash, the crypto industry has also taken flight due to younger generations being “locked out of the traditional financial system,” according to Bourkoff.
He cited Alex Masmej’s personal funding experiment in which a 23-year-old French entrepreneur raised money by selling personal ALEX tokens. Buyers were then promised 15% of his income over the next three years. Bourkoff called the venture “promising” for creators and athletes bold enough to go this route.
The letter wasn’t all starry-eyed fodder for the bulls, however. Bourkoff also listed several barriers for the industry moving forward.
First, he wrote that the industry is still too exclusive, adding that just several thousand own the lion’s share of Bitcoin and that even the NFT sector has become a “gathering space for technological insiders.” Bourkoff argued that “women, minorities, and yes, also the elderly” need to be involved to solve this pain point.
Next, he touched on crypto’s environmental impact, again turning to Bitcoin’s woes of consuming more energy than nation-states. The LionTree CEO was nonetheless optimistic that the leading network’s transition to renewable energy and the arrival of (PoS) will alleviate some of these concerns.
Bourkoff also pointed to regulations, asking whether regulators around the world will continue to stand aside, make room for the industry, or if 2022 will see harsher crackdowns like those in China.
Finally, and less a critique than other items on the list, he anticipates more and more communities will launch native tokens, many of which won’t like a either.
“I also expect to see churches, political groups, and even whole industries begin to create common currencies over the coming year,” he said.