Mark Cuban, the billionaire investor made famous by the reality television series Shark Tank, has changed his tune on bitcoin and cryptocurrencies in recent months.
Cuban made headlines when he said he’d “rather have bananas than bitcoin,” calling crypto “too complicated.” But the Dallas Mavericks owner has since come around to cryptocurrencies, praising the emerging decentralized finance (DeFi) space—which is largely built on top of the second-largest cryptocurrency after bitcoin, ethereum.
Now, as the bitcoin and cryptocurrency market price soars over $2 trillion, Cuban has revealed that he expects ethereum’s long-awaited 2.0 upgrade will spark the development of apps that “dwarf” bitcoin.
“I think the applications leveraging smart contracts and extensions on ethereum will dwarf bitcoin,” Cuban told journalist Laura Shin, speaking on her Unchained podcast.
“Bitcoin, right now, has evolved to be primarily a store value, and it’s very difficult to use it for anything else … You really have to work a lot harder on bitcoin than you do on ethereum.”
The bitcoin price has soared by around 700% over the last 12 months, climbing as the likes of high-profile billionaires Elon Musk and Jack Dorsey give it their backing, Wall Street giants roll out bitcoin services, and investors fret that inflation could be about to undermine the value of traditional currencies.
However, the huge bitcoin price rally has been eclipsed by ethereum (and a handful of smaller cryptocurrencies), with the ethereum price adding a blistering 1,100% since April 2020.
Cuban expects coming upgrades to ethereum, not expected to be completed until at least 2022, will mean it is “going to give some people a reason to use ethereum as a store of value over bitcoin.”
Last year, ethereum began implementing its major 2.0 upgrade, designed to improve scalability and security and will see the ethereum network move from bitcoin’s proof-of-work (PoW) consensus algorithm to the proof-of-stake (PoS) algorithm.
This will essentially mean those who receive ethereum’s ether tokens as a reward for maintaining the network will be removed from the process in order to optimize the settlement of transactions—with ethereum users instead able to deposit their tokens to secure the network and earn rewards instead.
“With proof-of-stake, you’re going to be able to have, some multiple, a significantly higher multiple, in transactions per second, that’s going to improve the utilization and the opportunities to create on ethereum,” Cuban told Shin, pointing to the latest cryptocurrency craze for NFTs (non-fungible tokens) as “just proof of concepts” for what smart contracts can do.
“In a few years, I think ethereum and maybe two or three other blockchains will have their place, and those will be the winners,” Cuban said, adding that he’s not about to sell his bitcoin but that he does “own a lot more” ethereum than bitcoin.