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Billionaire technology investor and entrepreneur Mark Cuban believes bitcoin can’t scale to the level of centralized settlement systems like Visa and Mastercard and thus, considers bitcoin as a store of value.

Cuban Admits Bitcoin is a Robust Store of Value

In October, during an interview with Bloomberg’s Emily Chang at the Vanity Fair New Establishment Summit in Los Angeles, Cuban confirmed his investment in bitcoin through an exchange-traded fund (ETN) in Nordic Nasdaq, a Swedish stock exchange.

“It is interesting because there are a lot of assets which their value is just based on supply and demand. Most stocks, there is no intrinsic value because you have no true ownership rights and no voting rights. You just have the ability to buy and sell those stocks. Bitcoin is the same thing. Its value is based on supply demand. I have bought some through an ETN based on a Swedish exchange,” Cuban said at the time.

For many years prior to his first bitcoin investment last month, Cuban had continuously described the digital currency as a “bubble.” But, over the past few years, Cuban has started to understand the structure of bitcoin and the basis of its valuation.

In an interview with MarketWatch, Cuban further emphasized that bitcoin is a robust and efficient store of value. He stated that personally, he considers bitcoin as a collectible like expensive art, because there is only a finite number of bitcoins that could ever exist.

Cuban said:

“So, it’s going to be very difficult for it to be a currency when the time and the expense of doing a transaction is 100 times what you can do over a Visa or Mastercard, right? And in this particular case, it’s a brilliant collectible that’s probably more like art than baseball cards, stamps, or coins, right, because there’s a finite amount that are going to be made, right? There are 21.9 million bitcoins that are going to be made.”

Can Bitcoin Scale to a Efficient Digital Currency?

Bitcoin is an efficient and robust store of value, which solely depends on the market for its market valuation. But, in his statement, Cuban explained that bitcoin cannot operate as a currency because it does not have the capacity of centralized systems like Visa and Mastercard.

To an extent, Cuban is accurate in that bitcoin can only settle around six transactions per second as of now, while Visa and Mastercard can settle thousands of payments per second. Still, bitcoin is at an early stage in development. As a decentralized financial network, with scaling solutions and innovative software, bitcoin can scale to evolve into an efficient digital currency in the long-term.

Currently, the vast majority of bitcoin investors use bitcoin as a store of value and a safe haven asset, like digital gold. But, as bitcoin scales in the long run, an increasing number of investors will begin to use bitcoin as a currency.

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