According to Cuban, bear markets are positive for the crypto ecosystem, precisely because it purges the ecosystem of worthless propositions and makes developers work focused on using technology to solve real problems.
- The bear market will cause some cryptocurrencies and projects to collapse, Cuban assures.
- Only highly innovative projects will survive.
- Although prices fall, bear markets bring benefits to the ecosystem.
For the billionaire investor and owner of the Dallas Mavericks, Mark Cuban, the crypto winter will continue to make its effects felt for months to come, and this will lead to some cryptocurrencies and their responsible projects collapsing in the face of the falling market.
Cuban sostiene que los proyectos menos sólidos desaparecerán
This is what Cuban said during an interview this week with the magazine Fortune, in which Cuban presented his perspectives on the general downturn affecting the cryptocurrency market, being very emphatic that the projects with less solidity the programming language used by Ethereum for developing smart contracts. are going to disappear in the midst of this scenario.
“In the stock and cryptocurrency cryptocurrencies are digital currencies that use cryptographic technologies to secure their operation. sector, you will see companies disappear that were propped up by cheap, easy money, but had no valid business prospects. As Warren Buffett says, ‘When the tide goes out, you can see who’s swimming naked’.”
But just as he predicts a bad prognosis for those projects that enjoy less solidity, Cuban took the space and said that those initiatives within the crypto sector that are highly innovative will undoubtedly break through and stay up and running:
“Apps and technologies that are disruptive that are launched during a bear someone who believes that prices in a given market will decline over an extended period. Such a person might be referred to as “bearish.” market, whether it’s stocks, cryptocurrencies or any business, will always find a market an area or arena, online or offline, in which commercial dealings are conducted. and succeed.”
Correlation between the crypto sector and the stock market
Another aspect Cuban mentioned was the relationship between the cryptocurrency sector and the stock market, which he said would be subject to the same principles.
In that sense, the investor detailed that cryptocurrencies and the stock market are highly correlated, so the measures of the US Federal Reserve (FED) will make their weight felt on both, causing both sectors to face financial difficulties at this time.
“If [interest] rates go up, you’ll have trouble until it’s valued. The exception, as with stocks, will always be new applications that change change — a concept relevant to cryptocurrencies that use the UTXO model — is the number of coins sent back to a user after they use their unspent outputs to initiate a transaction. the rules of the game.”
Winter crypto and its potential for innovation
Although many fear the crypto winter because of the drop in the price of the main cryptocurrencies, there are people like Cuban who see a positive side to this scenario, as it would help to purge the market by taking out of circulation those projects that do not offer real value.
In a previous interview Cuban said that bear markets are very beneficial for the evolution of cryptocurrencies, because when the price has fallen, developers begin to think about how to innovate with such technology and solve problems present in the real world.
In this sense, it seems that Cuban’s words point to the path followed by projects such as Ethereum, Cardano, Polkadot, Avalanche and many others, whose emphasis is on creating ecosystems where Blockchain a distributed ledger system. A sequence of blocks, or units of digital information, stored consecutively in a public database. The basis for cryptocurrencies. The network a network refers to all nodes in the operation of a blockchain at any given moment in time. is suitable for a large number of use cases. As a result, the responsible teams continue to work on ways to optimize these networks, preparing them precisely to meet the demand and address a place where cryptocurrency can be sent to and from, in the form of a string of letters and numbers. the needs that different use cases would entail.
- Ripple is ready for the crypto winter and will continue to hire employees, Brad Garlinghouse says
- With Bitcoin the biggest and most popular cryptocurrency in the world. It is a decentralized digital currency that enables users to make trustless peer-to-peer transactions. above USD $30,000 does it make sense to talk about crypto winter as it happened in 2018?
- Cryptowinter is temporary, says Polygon founder, but Dogecoin creator thinks it could last 4 years
Version by Angel Di Matteo / DiarioBitcoin
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