Billionaire Mark Cuban does not brag about crypto
As the crypto market declines, little is heard from crypto evangelists.
Although not strictly an evangelist, billionaire Mark Cuban has invested in the industry. He believes in the future.
But Cuban, as an experienced investor, has also kept all its clarity. In a recent interview with Fortune, the billionaire entrepreneur said that the crisis that the cryptocurrency space is now going through will make it possible to sort out valid projects from those that are based on nothing.
“In stocks and cryptocurrencies, you will see companies that were maintained by cheap, easy money – but that did not have valid business prospects – will disappear,” Cuban said. “As [Warren] Buffett says, “When the tide goes out, you get to see who swims naked.”
Bitcoin, the king of cryptocurrencies, has lost more than 70% of its value since November 10, the date of the highest record of $ 69,077.44. The most popular cryptocurrency is currently trading at around $ 20,657.77, according to data firm CoinGecko.
Ether, the second largest digital currency by market value, is down 77.6% from November 10, when prices reached $ 4,878.26. Ether is currently at $ 1,094.06.
This collapse is explained by fears of a recession that are forcing investors to liquidate risky assets while the Federal Reserve aggressively raises interest rates to fight inflation to a maximum of 40 years.
But this is also due to internal scandals in the crypto industry. In May, the sister token UST and Luna suddenly crashed, causing at least $ 55 billion to disappear after UST lost its link to the dollar, the basis for qualifying as a stablecoin – a cryptocurrency linked to a more stable asset such as the US dollar or gold.
UST is an algorithmically stable coin, which is not supported by dollar reserves, but rather by the sister asset Luna, which had to be burned, or permanently destroyed, through a computer code.
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Cuban remains a crypto-believer
One month later, cryptocurrency lender Celsius Network suddenly froze withdrawals from its platform. Since then, rumors of insolvency have circulated about the company. Celsius has remained silent about these rumors.
Despite this bad news, Cubans remain optimistic about the future of the crypto industry.
“Disruptive applications and technology released under a bear market, whether it is stocks or crypto or any business, will always find a market and succeed,” he told Fortune.
He also said that cryptocurrencies are related to Nasdaq. Tech stocks and Bitcoin have been moving in step lately.
“If prices go up, it will struggle until it is priced in,” Cuban said. “The exception, as with stocks, is for new, game-changing applications.”
Cuban calls himself the Ethereum maximalist, which means that he favors the platform over other blockchains.
The billionaire likes Ethereum because it is the most used blockchain, and the platform has smart contracts, a piece of data code that determines the terms of a transaction (loan, trade, etc.) and is not dependent on any third party.
“Any crypto investor or speculator should use these 4 factors to understand the risk of any token,” Cuban wrote on Twitter on June 10.
He also owns other cryptocurrencies and non-fungible tokens (NFT).
Cuban has invested in blockchain companies.
