On June 13, the billionaire investor and co-host of the television series Shark Tank, Mark Cuban, explained his fascination with decentralized finance (defi) in an editorial published to his blog. Cuban details that many defi organizations are different because they are not corporate entities or based in the United States. He believes that “no one owns majority control” of these operations which makes them “permissionless” innovations.
Mark Cuban Sees Massive Potential When It Comes to Permissionless Finance
The entrepreneur Mark Cuban has been in the crypto space for quite some time now, and a recently published blog post explains he is focused on defi innovation and decentralized exchange (dex) platforms.
Cuban wrote an opinion piece on his blog called: “The Brilliance of Yield Farming, Liquidity Providing and Valuing Crypto Projects,” which explains the defi universe from his point of view. Cuban stressed that yield farming via staking and liquidity providing are the core features of defi and as far as the economy is concerned, he believes defi could be the “next great growth engine.”
Cuban discussed his interest in certain projects like Polygon/Matic and a number of dex platforms he personally leverages. “Examples of such exchanges that I use are zapper.fi, quickswap.exhange, bancor.network, [and] uniswap,” Cuban wrote. The investor further detailed the benefits of these operations by explaining how finance companies need financial depth to offer specific services.
“You need to be able to afford to hedge the risk of pricing volatility between currencies. If you want to do this business with scale, across the world, it can be very expensive and risky,” Cuban’s blog post insists. The Shark Tank co-host added:
Not for Defi Exchanges. What makes running a Defi exchange so much better than a traditional centralized financial business of this and any kind is that rather than the owners of the business, investors and their creditors putting up capital for all the transactions to take place, Liquidity Providers (LPs) do it for them.
‘The Rewards Have to Be High Because It Is Truly a Laissez Faire Market’
Cuban remarks that currently exchange competition is “brutal,” and he describes the rewards of this economy as “a Laissez Faire market.” The investor discusses projects like Compound and Aave, and how Aave is a “completely automated, permissionless platform where there are no bankers, no buildings, no toasters, no vaults, no cash, no holding your money, no forms to fill out, no credit ratings involved.” Cuban further emphasized:
Everything is controlled by smart contracts. It’s fully automated. You don’t have to get approval from anyone and it takes minutes to take out a loan. This is called being Permissionless — This approach is the future of personal banking.
The Shark Tank co-host reminisced about when he gave a Zoom speech during the pandemic and said he sees the world changing after what happened in 2020 and 2021. The world’s companies will transform, Cuban said at the time, and he envisions defi and crypto firms being an important part of this global transformation. Moreover, if the U.S. doesn’t pay attention, the country could miss out on the “next great growth engine.”
“Among those [transformative] companies, it’s already a certainty that Defi and other crypto organizations will be at or near the top of the list,” Cuban’s blog post concludes.
“Unlike the early days of the internet where we fostered and supported innovation and entrepreneurs, we are already seeing our politicians shitting on the innovations crypto is fostering. Hopefully, this changes quickly or we will lose the next great growth engine that this country needs.”
What do you think about Mark Cuban’s outlook when it comes to crypto and defi? Let us know what you think about this subject in the comments section below.