[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
Bitcoin (BTC) has faced its fair share of criticism in the eleven years since its inception, with top business figures such as Warren Buffett, Jamie Dimon and even President Donald Trump criticizing the pioneer digital asset. In a follow-up to his comments on bitcoin in September, Dallas Mavericks billionaire owner Mark Cuban said he sees no future scenario in which crypto’s flagship asset could be used as a reliable currency.
“No chance,” Cuban said to me in an email, answering a question regarding any type of future scenario in which he sees bitcoin becoming a reliable currency.
“Not because it can’t work technically, although there are challenges, it could, but rather because it’s too difficult to use, too easy to hack, way too easy to lose, too hard to understand, too hard to assess a value,” Cuban explained. The billionaire also pointed out the vast number of other rival crypto assets available, adding that it is “too much work for people to know why BTC over everything else.”
Cuban has not shied away from commenting on cryptocurrencies in the past, including his reference to bitcoin as a bubble in 2017, as well as even taking part in an initial coin offering (ICO) for UnikoinGold, a crypto asset associated with online sports betting operation Unikrn, according to a CoinDesk post.
The Shark Tank star most recently expressed skepticism toward bitcoin in a question and answer style YouTube video from media outlet Wired in September. Cuban related bitcoin to other speculative items, such as baseball cards and gold, although he added that bitcoin has less utility. “At least I can look at my baseball card and go, ‘Ooh, that’s my favorite player, that’s Roberto Clemente,’” Cuban said in the video, adding that he would rather have bananas than crypto, due to the fruit’s edibility.
Answering a question about a future scenario in which bitcoin might someday become a reliable financial asset, Cuban told me:
“It is a collectible. If you consider art or gold a viable stable financial asset, then yes. It can be.”
Why The Dallas Mavericks Accept Bitcoin
As the owner of the NBA’s Dallas Mavericks, Cuban’s thoughts and comments on bitcoin have not deterred him from allowing Mavs fans to use bitcoin as a form of payment.
The Mavericks announced bitcoin as a payment method for tickets and merchandise in August 2019, as only the second NBA team to do so, according to an announcement on the Mavs website. The organization uses service provider BitPay as a means of bitcoin payment processing.
“We first took BTC about five years ago,” Cuban explained to me. “No one bought anything so we stopped,” he said. “We decided to offer it again because the gateways became simpler and if we have a customer that wants to buy with it, I’ll take bitcoin or bananas,” he added. “[M]y job is to make it easy for our customers to do business with us.”
Many participants in the crypto space have also pointed toward bitcoin as more of a store of value than a transactional currency, noting the coin’s debatable scalability for such a transactional role.
Crypto expert and Morgan Creek Digital hedge fund cofounder Anthony Pompliano sees bitcoin as a significant and unique player in this store of value category due to the asset’s stated lack of correlation to the ebbs and flows traditional markets.
“Institutions have spent decades looking for non-correlated assets that they can use as a diversification in their portfolio,” Pompliano told CNBC in August. We’ve been banging the drum for over a year now saying that this [bitcoin] is a non-correlated asymmetric asset.”
Disclaimer: I actively trade cryptocurrencies, as well as hold a small amount of BTC, ETH, LTC, XMR, NEO, ZEC, BEAM, BCH, DASH and various insignificant other altcoin positions.