Here’s what Mark Cuban said about the recent crypto crash

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Cryptocurrencies have become an increasingly popular investment, but they are also volatile. And the crypto sector has recently experienced a major downturn. In fact, midway through the year, the total crypto market had seen a 70% decline and was down over $2 trillion from the all-time high valuation it had barely reached. seven months ago.

In light of this major downturn, cryptocurrency enthusiast Mark Cuban had some wise words for current and future investors in virtual currencies.

Here’s what Mark Cuban had to say about the crypto crash

Mark Cuban is the billionaire owner of the Dallas Mavericks and is a well-known investor famous for his role in the television show shark tank. He personally owns cryptocurrencies, including non-fungible tokens (NFTs) based on Ether and Ethereum.

When the market downturn began, Cuban commented on Fortune’s crash, saying, “In stocks and crypto, you’ll see companies that were backed by cheap, easy money — but had no valuable business prospects – will disappear.

This does not mean, however, that Cuba thinks that all virtual currencies will be equally affected. As he went on to explain, “As [Warren] Buffett says, “When the tide goes out, you can see who’s swimming naked.”

Essentially, this means that when times get tough, only currencies that have real value will continue to remain viable investments with growth potential. Coins that have no underlying value – in the form of innovative technology or real-world applications – will likely see their price drop dramatically and may not be able to recover at all.

Cuban remains optimistic about the future of crypto investing

Cuban was not entirely pessimistic about the future of the crypto market. While he thinks some virtual currencies are unlikely to survive the recession, he also made it clear that he thinks others will thrive.

“Disruptive apps and technologies launched during a bear market, whether in stocks, crypto or any business, will always find a market and be successful,” he said.

He also pointed to the close connection between the cryptocurrency market and the Nasdaq, which is the second-largest exchange and the exchange on which many leading tech companies list their shares, including Apple, Amazon and Meta (formerly Facebook). ). Tech companies and cryptocurrencies, especially Bitcoin, tend to operate similarly, and this has especially been the case in recent months.

While the Nasdaq has seen periodic declines, rallies have always occurred and the tech stocks listed there have rebounded. There is reason to believe that the same will happen to many virtual currencies, especially those that offer something disruptive or are backed by solid technology.

“If rates go up, there will be a hard time until they’re factored in,” Cuban said, referring to interest rate hikes spurred by the Federal Reserve’s efforts to fight climate change. ‘inflation. “The exception, as with equities, is for new, game-changing apps.”

All of this means that Cuban is unlikely to abandon his positions in the cryptocurrencies he invests in – nor would he likely advise other crypto investors to abandon the sector. This is especially true for those who make wise investments after thorough research, which they believe will be able to weather economic downturns and stand the test of time.

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