The well-known entrepreneur has invested in a number of cryptocurrency projects and businesses. The abrupt and rapid collapse of the FTX cryptocurrency exchange has shocked the crypto community. The sudden demise of a company valued at $32 billion in February cast doubt on the entire young industry of financial services based on Blockchain technology.
The industry’s confidence is at an all-time low. Retail investors have fled, while institutional investors connected to FTX and its sister company Alameda Research are still calculating their losses from Sam Bankman-empire. Fried’s While there are lessons to be learned from this disaster that threatens the entire sector, it is an understatement to say that regaining lost confidence will take time.
‘A Lot of Errors’
Billionaire Mark Cuban, on the other hand, remains optimistic. Despite the fall of FTX, he remains optimistic about the industry and assures that there is still a lot of value in it. He believes that cryptocurrency has a place and that all you have to do is look at the big picture. “Separate the signal from the noise,” Cuban said, according to TMZ. “A lot of people have made a lot of mistakes, but that doesn’t change the underlying value.” Cuban believes that as long as consumers have viable options in the crypto world, the currency will not tank.
The Dallas Mavericks owner is currently the subject of a class action lawsuit stemming from the bankruptcy of crypto lender Voyager Digital, which he promoted in an October 2021 partnership. The goal of this collaboration between Voyager Digital and the Dallas Mavericks was to promote cryptocurrencies by making them more accessible through educational and digital programs.
“Cuban and Ehrlich, as will be explained, went to great lengths to use their experience as investors to dupe millions of Americans into investing — in many cases, their life savings — into the deceptive Voyager platform and purchasing Voyager earn program accounts (“EPAs”), which are unregistered securities,” the class action lawsuits said, referring also to Voyager CEO Stephen Ehrlich. “As a result, over 3.5 million Americans have lost nearly $5 billion in cryptocurrency assets.”
Voyager declared bankruptcy on May 9 as a result of a credit crunch caused by the sudden collapse of sister cryptocurrencies Luna and UST. Millions of customers have seen their savings disappear. FTX purchased Voyager Digital assets as part of the mortgage lender’s liquidation process.
“A simple question. Why did I invest in cryptocurrency?” On November 13, Cuban posted on Twitter. “Because I believe smart contracts will have a significant impact on the development of useful applications. I’ve said since the beginning that the value of a token is derived from the applications that run on its platform and the utility they provide.”
The Smart Contract
A smart contract is a piece of computer code that determines the terms of a transaction (loans, trading, etc.) without requiring the involvement of a third party. “What has not been created is a ubiquitous application. One that is clearly needed by everyone and for which they are willing to go through the learning curve. Perhaps it will never arrive. I hope and believe it will, “Cuban went on.
The billionaire then compared the cryptocurrency industry to the streaming industry, implying that bad ideas will die while good ones will thrive.
“I think the best analogy is the early days of streaming. It was insane what people had to do to listen to a 16k stream of music. A subscription to the internet for your dial-up modem. Install the provider client. Install a TCP/IP client. Install the streaming client “He contended. “On a website, click on a batch file. Check that everything worked properly. All while being mocked for not turning on the radio or television.”
He concluded on a positive note. “But it was worthwhile for in-office or out-of-market use. It began as a niche in 1995. Smart Contracts have been around for about 5 years.” Cuban is involved in a number of cryptocurrency projects, including the exclusive Bored Ape Yacht Club, which houses a collection of over 10,000 online images of monkeys in amusing poses. The most expensive non-fungible tokens are bored apes (NFTs).
He is known in the crypto space as an Ethereum maximalist, which means he believes strongly in the potential of the second-largest crypto ecosystem after Bitcoin. Ethereum is regarded as the internet of the cryptocurrency industry, with the goal of disrupting traditional financial services.
