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This is what Mark Cuban thinks is wrong with the crypto industry

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This is what Mark Cuban thinks is wrong with the crypto industry
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Hint: it’s not the fall in prices that bothers Cuban.


Key points

  • Cuban believes crypto needs to move beyond replication and start innovating.
  • The billionaire investor is on the hunt for the next big must-have that even non-crypto fans want to use.
  • For crypto projects to succeed, they must generate revenue like any other business.

The cryptocurrency industry has struggled this year, with many cryptos down 80% or 90% from their all-time highs. But that’s not what worries the billionaire investor and shark tank Judge Mark Cuban. For him, it is the lack of innovation in crypto that is of most concern.

Imitation is not enough, it will take innovation to drive crypto

Talk to Daily Altcoin, Cuban said he is still bullish on cryptocurrency. However, he wants to see new ideas and the emergence of the next big thing that will bring a new wave of interest in crypto. “We’ve gone from DeFi to collectables but now what?” he said. “What worries me is that there is no next candidacy.”

Cuban says if you look back at how crypto has evolved in recent years, first there was the DeFi summer, followed by NFT. Each attracted more people, increased interest and new funds from investors. The problem is that projects now play to the edges and mimic previous successes instead of pushing to create something new.

“Rather than seeing true innovation, you see reproduction,” Cuban said. “That’s not going to be enough to bring people back to crypto.” He compared it to the evolution of internet, where streaming, websites and online shopping each sparked a new wave of interest. Then everything quieted down around 2000 and 2001 before social media and app stores started to attract new users again around 2004.

“The thing that’s going to take crypto beyond crypto-ites is something where you just have to use it,” he said. “Crypto hasn’t had that moment yet where your grandma, your little brother, your little sister all have to use it.”

What Mark Cuban is looking for in a crypto project

Evaluation cryptocurrency projects can be difficult, but a crucial part is to think about how the crypto will generate income. Just because it’s a cryptocurrency doesn’t automatically make it a working business. Cuban explains, “The thing about crypto that I think people sometimes don’t realize is that you need users for people to buy and use Ethereum (ETH) or whatever.”

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Begin

If we are talking about an ecosystem like Ethereum, that means you need to see the apps that will generate gas charges. “Look at the number of transactions,” Cuban says. “For me, that’s the key to success.”

In terms of gambling to win, another crypto trend that exploded in 2021, Cuban says there has to be a reason people are buying the tokens outside of gambling itself – or some other source of income like coins. advertising revenue. The crypto guru says if your game to win has no way to generate revenue outside of tokens, you’re in trouble.

At the end of the line

Last year’s crypto frenzy is well and truly over, but many crypto enthusiasts like Cuba still see long-term potential for the industry. If you are considering buy crypto, Cuba’s advice on seeking public services and generating income is valuable. There’s a lot we don’t know about the evolution of the industry, but if a project can’t sustain itself, it’s hard to see how it will survive in the long run.

Cryptocurrencies are high risk investments. It’s important to only invest money you can afford to lose and make sure the crypto is only a small part of your larger portfolio. Don’t assume a project will succeed just because it uses blockchain. It still needs to operate as a business if it is to thrive and generate strong returns.

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