Mark Cuban. Source: a video screenshot, Youtube, TMZSports
The debate between Bitcoin (BTC) and Ethereum (ETH) got even more complicated thanks to American billionaire Mark Cuban. He continues to praise ETH as superior to BTC, but stores a lot more of his assets in this most popular cryptocurrency than ETH, wants to buy more BTC and doesn’t plan to sell it.
In March he said that ETH is “the closest thing to the real currency” and now he’s talking about ETH as a store of value alternative because it “has many more built-in benefits in its organic and native form”.
“Because people use ETH to buy NFTs, to do more, and because smart contracts make things a little easier. And because we are hopefully aiming for a more short-term development towards ETH 2.0, […] I think you will see that right now there are more reasons to buy ETH than just being a store of value – but it doesn’t preclude being a store of value in order to buy ETH, “said the owner of Dallas Mavericks Lately Unchained Podcast.
He added that with Ethereum Improvement Proposal (EIP) 1559, “everything changes and what happens in the future will really affect how people specifically perceive it as a store of value.” As soon as proof of use is achieved and a much higher number of transactions per second occurs, the environment will change massively, which for some is a reason to use ETH as a store of value compared to BTC.
“I think the apps that use smart contracts and extensions to Ethereum will dwarf Bitcoin. Bitcoin will be a store of value, but since it has to be done with miners, you can’t just proof-of-stake with Bitcoin.” switch, “said Cuban.
Meanwhile, any asset that seeks appreciation must be sold with narrative, Cubans said. While Gold’s narrative was historically a hedge against inflation, it never was, he argued. Gold isn’t actually needed, but the telling of it being valuable helps add to its value.
“And bitcoin is the same,” he said. There’s no correlation between the Fed’s actions and the price of BTC, but it’s a “great narrative,” he said. “All assets could rise in price with inflation, and Bitcoin could be one of them […] but also the cost of bananas. ”
This means that as a “Bitcoin creditor as a store of value” he will “make an exception” – he plans to buy new BTC, not to spend his existing coins and thus buy a Tesla.
He also recently said that his crypto portfolio is 60% Bitcoin, 30% Ethereum, and 10% other crypto assets.
Reserve currency and global flood
Mike McGlone, Senior Commodity Strategist at Bloomberg Intelligence, argues that BTC has a better chance of becoming a reserve currency than ETH. According to an April Bloomberg Galaxy Crypto Index report,
“It seems that the narrative has tended to allocate a small fraction of the assets to the crypto, compared to the risk of missing out on the potential for Bitcoin to become the global benchmark digital asset. The introduction of the benchmark crypto as a global reserve asset has crossed the mainstream threshold as we see it and market tide is rising. “
McGlone said that BTC is replacing gold more suddenly than gradually and that the process is likely to accelerate “by underpinning its price for the foreseeable future and strengthening the dollar’s dominance as a reserve currency”.
Bitcoin fulfills the need for digital reserve assets in a world with low returns, he said. Companies like Visa, Goldman Sachs and Morgan Stanley have “welcomed the digitization of money and advanced the process of replacing gold with bitcoin as a global digital reserve asset,” the strategist said.
Most indicators show a changing global tide favoring Bitcoin as a reserve asset, McGlone concluded.
Despite this tide, ETH continues to outperform BTC in the crypto market.
At 15:41 UTC, BTC with a market cap of more than $ 1 billion is trading at $ 56,572, up 676% per year, while ETH (market cap – $ 239 billion) is trading at $ 1,992 and $ 1,074%.
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