Tech entrepreneur and Dallas Mavericks owner Mark Cuban joined the growing list of skeptics warning about the apocalyptic dangers of Facebook’s cryptocurrency project, Libra.
In an interview with CNBC, Cuban made his position on the Libra clear:
“I’m not a big fan of what they’re doing there. I think it’s a big mistake […] but it’s only in the talking stage so we’ll see what happens.”
Mark Cuban & Donald Trump Pooh-Pooh Facebook’s Crypto Plans
Mark Cuban and President Trump had a big falling out over politics. But they reached the same conclusion on Libra – that it’s an unfortunate project.
Trump bashed the Libra along with other cryptocurrencies on the grounds that they are competition for the U.S. dollar. He called the dollar the world’s most “dependable and reliable” currency. Trump said Facebook and other digital currency backers would potentially help back illicit activity.
Cuban seems to share these concerns, at least in terms of the Libra backing potential criminal activity. The Dallas Mavericks owner said that:
“I think globally and in countries where there isn’t a lot of rule of law, or a lot of government stability, or currency stability, then it could be dangerous […] There’s going to be some despot in some African country that gets really upset that they can’t control their currency anymore and that’s where the real problems start occurring,”
In the early days, bitcoin developed a bad reputation due to sites such as Silk Road. But over time, regulated entities like Coinbase have cooperated with law enforcement, making it easier for the government to monitor illicit activity.
However, it’s far from clear what Facebook’s plan for the Libra is. They claim that there will be safeguards in place to hinder criminals, but haven’t specified how these will function.
Backing Traditional Fintech Instead of Libra
There may be another reason for Cuban’s skepticism toward Libra. He’s been a long-time – if inconsistent – bitcoin skeptic, and recently compared crypto and gold to pet rocks.
What does he prefer? Disrupting the traditional banking system from within.
Cuban, along with superstar DJ Diplo, are backing a fintech startup called Dave. It recently launched the Dave banking app helps users build credit scores simply from paying their rent on time; it also blocks users from accidentally causing overdrafts to cut down on fees. Dave recently raised $110 million.
Cuban’s investment in Dave could potentially lose value if Libra or another crypto alternative ends up becoming a leading option in place of traditional bank accounts.