Former SEC Head Bashes Crypto, Angers Mark Cuban

Former SEC Head Bashes Crypto, Angers Mark Cuban

June 6, 2021

Mark Cuban has taken issue with some comments uttered by John Reed Stark, the former chief of the Office of Internet Enforcement for the Securities and Exchange Commission (SEC). According to Stark, cryptocurrencies like bitcoin and Ethereum bear “no utility,” something that Cuban seems to disagree heavily with.

Mark Cuban Rushes to Crypto’s Defense

Not long ago, Cuban stated that he owned bitcoin and believed it would be a serious hedge in the future against inflation and other harsh economic conditions. He also claimed to be a huge fan of Ethereum due to its capabilities with smart contracts and its birthing of decentralized apps (dapps). By contrast, Stark is not praising digital currencies, and said in a recent interview with CNBC that these assets have no practical use.

Cuban was quick to strike on Twitter, explaining:

Watching CNBC and the guest who used to work at the SEC has absolutely no understanding of crypto. Says there is zero utility. One certainty is crypto will continue to positively impact business more than the SEC. I am happy to educate him on the applications we are developing.

Interestingly, Cuban faced his own opposition, as one Twitter user was quick to challenge him and ask where crypto has potentially done better than its financial competitors. Cuban responded with a rather long list that included the following:

Weather insurance. Money transfer. Provenance for digital files. Marketplace efficiency for digital content. Personal banking. Prediction markets. Non-fractionalized banking. Structured financial products. Fractionalization of assets. Gaming rewards. Soon ticketing.

All this is coming from a man who at one point appeared to have a rather hostile attitude towards bitcoin and crypto. Cuban even went so far as to say that he would rather have “bananas” than bitcoin. Nevertheless, the owner of the Dallas Mavericks basketball team has seemingly done a 360 and become one of the world’s biggest crypto advocates.

One of Stark’s issues with digital currencies is that they have potentially been “enabling” ransomware attacks over the past decade. He stated:

Ransomware is hitting everywhere, and they are all collecting it in bitcoin because there is no way they are going to get caught. So, you are also enabling it. The country is kind of falling apart from ransomware all because of crypto and the main reason people own crypto is because they think someone else will buy it and make the price higher.

I Still Like Blockchain…

Stark was also quick to defend himself against Cuban, saying:

Just because I cannot think of a single U.S. societal benefit (social, economic, or otherwise) of crypto and the untraceable financial transactions it facilitates does not mean I cannot appreciate the many potential benefits of blockchain, but I think Mr. Cuban misunderstood my commentary. Being anti-crypto does not mean I am anti-blockchain. The two philosophies are too often mistakenly conflated.

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