Mark Cuban, a billionaire Shark Tank star, predicts that cryptocurrency projects without “valid business prospects” will be defunct. Mark Cuban, the billionaire owner of Dallas Mavericks, has spoken out on the crypto crash. He said that projects without a “valid” business model would eventually fail.
Cuban stated in an interview with Fortune that “in stocks and crypto, companies that were sustained through cheap, easy money but didn’t have valid prospects–will vanish.”
The entrepreneur, a 63-year old, also remembered Warren Buffet, an American magnate, who once stated that “when the tide goes out you get to see the naked swimmers.”
The crypto market was hit by the implosion last month amid a wider tech market drop. As its algorithmic safecoin UST lost the dollar peg, it wiped out billions of investor wealth.
After Celsius Network, a crypto lending platform that has $11.8 billion under management, suddenly stopped withdrawing, the crypto market took another hit.
Major cryptocurrency markets plunged after the announcement. The price for Bitcoin (BTC), touched $20,000 Wednesday.
The combined market capitalization of crypto market fell below $1 trillion. Leading crypto companies such as America’s digital asset trading platform Coinbase or lending platform blockFi began to reduce staff. This added uncertainty to the market.
MicroStrategy was also highlighted in the crypto crash. It is reportedly facing a margin call on a $205 million Bitcoin-backed loan with Silvergate Bank. This was taken in March to purchase more crypto. Also, it is in danger of losing its multimillion-dollar crypto loans.
Cuban is optimistic despite the market’s clearly dire state and is putting his faith in innovation.
The billionaire said that disruptive applications and technology created during bear markets, whether in stocks, crypto, or any other business, will always find a market to succeed.
Cuban’s most recent remarks echo comments he made last week when he compared current conditions in the crypto industry to the dot-com bubble that erupted in the early 2000s.
Cuban stated that he saw much room for improvement back then, particularly in the areas of commercial smart contracts platforms replacing Software as a Service (SAAS).