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- Mark Cuban acknowledged there's rampant speculation in cryptocurrencies.
- The billionaire investor said revolutionary technologies often generate hype.
- Cuban defended the boom by pointing to the growing number of uses for crypto.
- See more stories on Insider's business page.
Mark Cuban recognizes lots of people are buying cryptocurrencies, not because they view them as fundamentally valuable, but because they expect others to buy them and drive their prices higher.
"Yes there is massive speculation," the billionaire "Shark Tank" investor and Dallas Mavericks owner tweeted on Wednesday. However, he argued plenty of transformative technologies sparked feverish excitement as they took off.
"Every single one of the technologies has been dismissed by legacy institutions," he continued. "Until they weren't."
Cuban made those comments in a Twitter thread defending crypto as a revolutionary innovation. He was responding to criticism that his aggressive promotion of dogecoin, a "meme coin" that was created as a joke, would result in buyers losing a bunch of money.
The technology entrepreneur – who became a billionaire by selling his internet-radio startup, Broadcast.com, to Yahoo in 1999 – has been one of dogecoin's biggest promoters. He went on "The Ellen DeGeneres Show" this week to reiterate his view that the coin is a fun way to learn about crypto, and a better bet than a lottery ticket.
Cuban also highlighted the growing number of uses for crypto in his thread. He suggested non-fungible tokens (NFTs) for digital collectibles, smart contracts, and decentralized finance (DeFi) could fuel demand for digital currencies and underpin their prices in the future.
"If you look at crypto assets whether eth, doge, btc, mkr etc and only see something intangible for people to trade, you haven't really looked," he said, referring to ether, dogecoin, bitcoin, and dai. "If you see smart contracts and programming languages and think of new ways to disrupt industries then I'm saying there's a chance."
Unsurprisingly, dogecoin has its fair share of critics. Michael Burry of "The Big Short" fame dismissed it as a "doge's breakfast" and one of several market bubbles, while billionaire investor and bitcoin bull Mike Novogratz warned against buying it and described it as a "dog."