- >Why Did Mark Cuban Say That Ethereum is Better Currency Than BTC?
Why Did Mark Cuban Say That Ethereum is Better Currency Than BTC?
Entrepreneur and Dallas Mavericks owner, Mark Cuban was quoted recently by CNBC as being bullish for Ethereum. What’s got the investor tuned into the cryptocurrency? Mark is already a business maverick of sorts, having a wide range of investments and businesses across a number of industries.
Cryptocurrency is not yet one of them explicitly. Perhaps his interest in Ethereum comes from his ability to see business opportunities.
Michael Brown | Apr 15, 2021
Value in the Blockchain
Cuban is quoted by a CNBC article as saying “It’s like the early days of the internet when everyone thought we were crazy.” So why might this be? Speculation on cryptocurrency is at an all-time high in the current bull market. There are a lot of companies, groups, and nonprofits coming out of the woodwork to jump on use-cases for blockchain technology, not unlike the dotcom craze of the 1990’s.
So why is blockchain technology so valuable then? Well because it functions as an administrative algorithm in many ways. In more ways than one, a blockchain can replace or automate much of the business and administrative tasks a regular corporation might face. An administration system based on blockchain technology might in fact be in the future. Especially for school systems, whose administration costs have ballooned well past general rates of inflation. Another important use case is of course in the field of banking. This is possible because the Bitcoin blockchain for example, acts as a sort of automatic banker. It verifies the ownership of who owns which tokens and so on. This, instead of requiring human labor to manage and perform those mentioned tasks.
These examples are just the tip of the iceberg. Many other use cases have been provided alongside tokens to go along with the blockchain use case. In many ways, these altcoin blockchains can resemble tech companies in structure and organization. However, they are branded as a cryptocurrency that they can stick a token on as an additional revenue stream. In addition to stock market offers (where applicable) this can add a lot of funds to the development of the a company, while also growing its own finances as the platform expands.
Is Ethereum a Currency?
So it’s easy to see why Mark Cuban might take an interest in more than one cryptocurrency project if he survived the Dotcom bubble. This feels like a hedge in the event that one of them falls to the wayside just like a ton of websites did in the 1990’s. In another CNBC article, Cuban states that he also thinks Ethereum resembles a currency. Perhaps he means a fiat currency? What currency has ever had transaction fees over $100? Cuban believes that Ethereum’s developer-side flexibility will lend to its development for the better, however the same can be said for the Federal Reserve, who are basically developers of the US dollar. Ultimately anybody with control over monetary systems has control over the money, whether they are software developers or a board of governors. The title doesn’t matter, the control over an entire system does.
It is under such conditions that cronyism run by whales comes to exist. Which is what we already have now and resorting to a monetary system that perpetuates that is likely to be a mistake. Cuban’s comments about smart contracts aren’t unfounded though. They are a useful feature, and they can be brought to Bitcoin. As far as I can see, Ethereum’s only claim to being a currency is that it is electronic fiat currency as opposed to the Bitcoin model of digital gold. Cuban also holds a majority of his assets in Bitcoin; 60% according to the CNBC article above. However 30% in ETH is a bit more than just a hedge.
Relationship with China
Cuban holds businesses in China, who have been notoriously anti-Bitcoin. It looks to me like Cuban is putting his fingers in as many pies that have projected increases in growth as possible. China famously was among the only economies in the world to experience a GDP increase in 2020. With Western economies declining due to the pandemic, it really only makes sense to put your money into assets that are appreciating rather than depreciating. In addition to this, China has recently launched their own digital currency, five years in the making. This CBDC will likely prove a boon to them if they ever reach the point of exchanging digital currencies over global exchanges.
This could set China up to brand it’s digital Yuan as a reserve currency for countries in its sphere of influence. Given Cuban’s already present business relationship with the communist nation, perhaps he anticipates the Chinese going bullish on their own crypto markets once they have established the digital Yuan. With one of the largest markets in the world, China adopting cryptocurrencies under its own terms could change the cryptocurrency game.
Cuban seems to have no ethical qualms with working with China, as he tried to explain in a heckling interview with Megyn Kelly. So perhaps he is simply betting on the proverbial strongest horses. At the moment, those horses are Bitcoin and Ethereum in the crypto world. On the international level, that currency war remains between China and the United States.