Dallas Mavericks owner and Shark Tank star Mark Cuban says that crypto assets offer tremendous value despite arguments to the contrary by naysayers.
In a tweetstorm, Cuban starts off by saying that Bitcoin (BTC) is a superior store of value compared to gold, which requires a ton of resources to transport and keep.
“Crypto succeeds when it’s a more productive implementation of its competition. BTC/Gold are both financial religions. BTC is easy to trade/store/create with no delivery issues. BTC also enables transfer of value locally and globally. Gold is a hassle. Just look at Ft Knox.”
With regard to the second-largest cryptocurrency by market cap, Cuban highlights Ethereum’s upside potential as its utility and ecosystem mature.
“ETH smart contracts are better, cheaper, faster at authenticating/buying/selling/delivering digital items than alternatives available. This makes it a viable currency and trading mechanism for all things digital. That’s powerful and will grow as applications are added.”
According to Cuban, Ethereum smart contracts are better than banks as they reduce the cost and friction involved in a number of financial services.
“ETH smart contracts for DeFi (decentralized finance) are better at enabling depositing/saving/trading of financial instruments than banks. One is automated and trustless and near immediate. The other is dependent on buildings full of people who add cost and friction to the same transactions.”
Looking at altcoins, the Dallas Mavericks owner points out that while risks are present, the ones that are likely to reward investors are projects that have a growing user base.
As for meme crypto assets like Dogecoin (DOGE), he says these coins can have a chance to succeed as long as they develop a use case and gain traction.
“Meme coins like Doge only work if they gain utility and users use them for that utility. As long as you can spend Doge, because we know its annual inflation rate is set at 5b coins, it can gain some value as the utility grows. It becomes like any other currency.”
On top of crypto’s strong use cases, Cuban notes that its decentralized and trustless properties make it even more valuable.
“Crypto not just about being more productive and effective, but also no longer dependent on ‘trusted institutions.’ Ask PPP (Paycheck Protection Program) applicants how much they trust their big banks? Do you trust your health insurer? Crypto is trustless and a better way to handle many transactions. So when someone says they don’t get why crypto assets have value. Show them this.”
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Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Featured Image: Shutterstock/Pavel Chagochkin