The Valuation Hurdles of Token Grants and Cross-Border Transfers? Lessons from Neil Thakur of Teknos Associates

By: Moish E. Peltz, Esq. and Kyle M. Lawrence, Esq.

As tokenization models mature and crypto businesses confront new tax and reporting rules, valuation has become one of the most consequential issues for founders, investors, and legal counsel. Episode 44 of the Block and Order podcast offered a detailed look inside that world through a conversation with Neil Thakur of Teknos Associates, a valuation professional who has spent years building frameworks for digital assets, token ecosystems, and on-chain intellectual property. Neil's insights detailed how valuation firms are navigating emerging challenges, which methodologies they rely on, and how regulation now directly shapes crypto valuation.

This post distills the most applicable elements of that discussion for clients and industry participants navigating token launches, cross-border transfers of IP, and the growing convergence between corporate structuring and digital asset economics.

The Starting Point: Treating Tokens Like Complex Securities

One of the clearest takeaways from the episode is that valuation firms have moved beyond simple price comparisons. Early token valuations often relied on thin data from unstable exchanges, for example, which Thakur described when telling the story of how his team valued XRP. Teknos Associates was one of the first firms to value cryptocurrency tokens when they valued XRP in a deal between Ripple and a market maker. “People were like, ‘What the heck is this?’” Thakur remembered, jokingly. “It was criminal to think about the industry in any regulatory way. But we took a stab at it from a financial modeling perspective.” 

This uncertainty pushed valuation firms toward more structured approaches. Thakur explained that his team values tokens “very similarly to some complex securities of option pricing theory and binomial models,” for example.

Options-based models allow analysts to map value across uncertain future states. Token values often depend on milestones such as network development, infrastructure deployment, regulatory clearance, or user adoption. Unlike traditional equities, where expected cash flows can be estimated, option pricing frameworks account for restrictions, vesting limitations, volatility, and the possibility of diverging outcomes.

In practice, valuation specialists blend these tools with project-specific analysis. When protocols generate fees or support staking yields, analysts can adapt.

For early-stage projects with little on-chain activity, analysts evaluate technical materials, incentives design, and long-term functionality to determine how optionality contributes to value.

Data Abounds but Trust Is Still the Central Problem

Even though token markets produce far more data today, analysts still struggle with their reliability. Liquidity is uneven across exchanges, user metrics vary widely, and prices can be distorted by offshore venues or thin trading pairs, Thakur explained. Liquidity and market depth affect price discovery, and valuation firms must determine which data sources are credible enough to use.

This problem extends to network metrics. Total value locked, daily active users, revenue dashboards, and other indicators can be manipulated or lack consistent definitions. Good analysts try to triangulate valuations by using several metrics, as a hedge against any one metric’s inaccuracies. They also incorporate interviews, documentation review, chain-level analysis, and scenario planning into their models. While the crypto market has matured, the core challenge remains that global on-chain data does not always provide a clear signal.

Regulatory Assumptions Are Now Part of Every Model

Valuation is no longer isolated from regulatory considerations, as Thakur noted when discussing the shift from offshore structures toward U.S.-based operations. “With the regulatory winds pushing back to the States, it’s making it safe for us to operate here, and the concept of offshoring things may not be necessary,” Thakur explained.

Regulatory scenarios affect discount rates, liquidity assumptions, token unlock schedules, and the overall risk profile of a project. If a token must be restricted for a longer period because of jurisdictional uncertainty, a good analyst’s valuation model reflects that. If reporting rules tighten around IP transfers, income recognition, or token grants, valuation firms adjust their approach accordingly. Even modest regulatory changes can shift a model’s output because they change optionality, which is central to option-based valuation.

While the podcast noted that U.S. policy is more open to digital asset activity than it was in prior years, the larger point is that changes in tax treatment and regulatory oversight materially affect valuation. Treasury guidance, IRS enforcement priorities, and agency coordination can all influence how analysts build their models.

IP Transfers, Token Economics, and Early Stage Pricing

When projects transfer IP into a foundation or foreign entity, valuation firms must determine the fair market value of that IP. This has direct implications for U.S. tax compliance, particularly with respect to income recognition and transfer pricing. Projects that issue tokens or token rights to founders or employees must also consider whether those grants trigger taxable income and require valuation support similar to 409A analyses.

Thakur explained that in many early-stage projects, a token may have little immediate economic value. Whether a project is migrating IP, granting token rights, or distributing tokens across entities, valuation must consider both current functionality and expectations of future development. “Once it grows and the token launches and the product, separate from [the foundation], starts to take shape, then you start seeing more value,” Thakur said. 

Planning around vesting, governance, token caps, and distribution schedules can play a significant role, as do withholding obligations, income timing, and how token issuance interacts with international reporting rules. As the U.S. considers further reporting requirements for digital asset transfers, valuation firms will increasingly incorporate regulatory timing and compliance costs into their pricing models.

When to Bring in Counsel

The episode made clear that valuation cannot be separated from legal and structural planning. Token distribution schedules, cross-border IP transfers, foundation formation, investor rights, and executive compensation all contain tax and regulatory elements that interact with valuation. Bringing in legal counsel early allows teams to coordinate the economic, technical, and structural sides of a digital asset project.

Falcon Rappaport and Berkman regularly advises clients on these issues and partners closely with valuation professionals and offshore counsel to help ensure that legal frameworks and financial models align. Whether your organization is preparing a token launch, planning an IP transfer, setting distribution terms, or evaluating a new digital asset structure, FRB can help you manage regulatory, tax, and structuring considerations in a cohesive way.

For guidance tailored to your business, reach out to FRB Partners Moish E. Peltz and Kyle M. Lawrence, who advise clients across Web3, AI, and other emerging technologies.

DISCLAIMER: This summary is not legal advice and does not create any attorney-client relationship. This summary does not provide a definitive legal opinion for any factual situation. Before the firm can provide legal advice or opinion to any person or entity, the specific facts at issue must be reviewed by the firm. Before an attorney-client relationship is formed, the firm must have a signed engagement letter with a client setting forth the Firm’s scope and terms of representation. The information contained herein is based upon the law at the time of publication.