American billionaire and investor Mark Cuban gave his take on the Reddit army who took on Wall Street and how blockchain assets, among other things, fit into the bigger picture.
In a blog post published on Jan. 31, the billionaire suggested that the old financial regime is taking a beating from the “Store of Value of Generation.”
Stores of value
Cuban pointed out that we are in the next step of an evolution in which ‘anything digital can be a store of value.’
He questioned what differentiates gold from other precious metals and renders it a store of value.
“There is nothing unique or special about gold other than enough people believe the story to buy gold,” he said.
He went to say that anything digital can be sold if it can be ‘generated and saved in a file format.’
Decentralization has changed the game, bringing in a new breed of stores of value.
“Blockchain-driven assets have now legitimately become stores of value.”
Digital stores of value have long included cryptoassets such as Bitcoin and Ethereum. However, the old-school brigade does not understand or appreciate it as they believe that something has to be tangible to become a store of value.
“To so many the idea that a CryptoAsset could be a store of value is crazy. To them, there is no there, there. There is no intrinsic value. To them it is a digital representation of nothing, that crazy people are paying good money for. That is not the case.”
Crypto markets are not perfect
They are few barriers to entry into the cryptocurrency market. However, the market is far from perfect and has its own issues.
The markets can be manipulated by whales (entities with huge crypto holdings) and in a fashion similar to that of the stock market and physical goods, the emerging market can be influenced by narratives that may or may not be true.
And even with these imperfections, traders love the market because they know that “no one has power over them.”
A new way of seeing things
It is not Cuban alone who sees blockchain assets as stores of value. In fact, many before him have thought as much.
A chief economist at the Bank of Singapore recently claimed that cryptocurrencies can replace gold as a store of value.