Mark Cuban Says Crypto Crash Is Same ‘Lull’ That the Internet Went Through:

Three office workers discuss a digital graph.

Image source: Getty Images:

Look for cryptos that add real value as these have better long-term potential.


Key points:

  • Mark Cuban warns blockchains cannot succeed in the long term by only imitating others.
  • The billionaire investor compared the recent plummeting prices with the early days of the internet.

Crypto prices have been struggling for most of this year, but Monday, May 9, was remarkable. Bitcoin (BTC) and Ethereum (ETH) both sank to 10-month lows, and the entire crypto market is now worth less than half of what it was in November.

Crypto investors attempting to make sense of the devastation may have been surprised to hear Mark Cuban refer to it as a “lull” on Twitter. They may feel that these dramatic drops are a lot more than a lull. Nonetheless, the billionaire crypto enthusiast has regularly compared the crypto market to the early days of the internet. His Monday tweet said, “Crypto is going through the lull that the internet went through.”

Why Mark Cuban sees parallels with crypto and the internet:

Now known as the dot-com era, when the internet first started to gain traction in the mid to late 1990s, we saw an explosion of businesses that – viewed with the benefit in hindsight – did not have solid fundamentals. People invested in internet companies without fully understanding what they did. They bought stocks simply because they got caught up in the hype and wanted to be involved in this new and exciting industry. When the bubble burst in 2000, many of those companies shut down and investors got burned. The prices of shares of companies that survived and still exist today such as Amazon and eBay fell dramatically.

Cuban’s tweet continued, “After the initial surge of exciting apps, NFTs, DeFi, P2E, we saw the imitation phase as chains subsidized the movement of those apps to their chains (ala bandwidth and storage subsidies by startups in the 2000s).” He points out the crypto industry does not need lots of blockchain networks that do the same thing. We do not need to have non-fungible tokens (NFTs) and decentralized finance on every blockchain.

Right now, there’s a lot of competition among smart contract cryptos to attract projects to their ecosystems. Many have grant programs to incentivize development as they race to gain market share. But Cuban says this is not the right approach. Instead, he thinks blockchains need to differentiate themselves and look for ways to apply smart contract functionality to the real world.

“What we have not seen is the use of Smart Contracts to improve business productivity and profitability,” tweeted Cuban. “That will have to be the next driver.” One of the factors that initially converted Cuban from crypto skeptic to enthusiast was understanding the potential of smart contracts. His stream of tweets on Monday stressed that the chains that realize the importance of finding business cases for smart contracts would be the ones that survive long term.

Our top crypto play isn’t a token – Here’s why:

We’ve found one company that’s positioned itself perfectly as a long-term picks-and-shovels solution for the broader crypto market – Bitcoin, Dogecoin, and all the others. In fact, you’ve probably used this company technology in the past few days, even if you’ve never had an account or even heard of the company before. That’s how prevalent it’s become.

Sign up today for: Stock Advisor: and get access to our exclusive report where you can get the full scoop on this company and its upside as a long-term investment. Learn more and get started today with a: special new member discount.

Get started:

What it means for investors:

There are many similarities between the crypto industry today and the evolution of the internet. Not least the high levels of hype and investor frenzy combined with relatively low levels of knowledge. Sadly, many people buy crypto in the hope of getting rich quickly and end up disappointed.

So, is the current crypto crash similar to the bursting of the dot-com bubble in 2000? There may well eventually be the type of lull that Cuban describes. But it’s too early to say for sure whether what we’re experiencing now is the start of it. We’re certainly in a period of extreme volatility. And we can say for sure that only solid cryptocurrency projects with good management teams and strong fundamentals will survive in the long term.

Crypto investors can take two main lessons from Cuban’s words. First, be prepared for an eventual crypto crash: similar to the end of the dot-com era. Only invest money you can afford to lose as even the most solid projects could see significant losses, and many cryptocurrencies will eventually fail. Second, research each project carefully:. Look for those with utility that improve upon rather than simply imitate existing projects.

Crypto crashes can be scary, especially if they cause you to doubt your original investment hypothesis. What’s reassuring is that Cuban thinks those blockchains that: are: able to differentiate themselves can survive in the long term. His words may help those trying to navigate these difficult waters.

Earn a $ 100 bitcoin bonus:

Our updated list of the best cryptocurrency apps for 2022 is packed with best-in-class picks. The cryptocurrency apps that landed on our shortlist include perks such as $ 0 commissions, and one pick that is offering a $ 100 bitcoin bonus. Check out the list here and get started on your crypto journey, today.

Get the top picks: