Bitcoin Naysayer Mark Cuban Is Buying This Coin
Billionaire entrepreneur Mark Cuban plans to participate in an initial coin offering (ICO), according to digital currency news website CoinDesk, just weeks after tweeting that bitcoin is in a “bubble”.
Cuban’s decision came after one of the companies he is invested in, e-sports betting platform Unikrn, announced plans to raise funds for a new online coin, commonly referred to as cryptocurrencies, to rival bitcoin. CoinDesk reports that Cuban, who previously acknowledged that there is value in blockchain, the underlying technology behind digital currencies, intends to participate. (See also: Initial Coin Offering)
In an email to CNBC, Cuban confirmed his intentions to back Unikrn’s ICO. "I want to learn more about them," he said. “[I] haven't signed the paperwork yet. But it's likely it will happen." In a separate interview with CoinDesk, Cuban described ICOs as "High risk, high reward,"adding that Unikrn is better positioned that its gambling peers to take advantage of the blockchain trend.
Seattle-based Unikrn is scheduled to launch a sale of tokens based on ethereum, a rival of bitcoin, in September. According to CoinDesk, $10 million has already been raised from investors, including actor Ashton Kutcher and Rupert Murdoch’s daughter Elisabeth Murdoch.
In 2015, Unikrn introduced Unikoin, a digital currency that players can use on on its betting website. The company’s founder Rahul Sood told Coindesk that Unikoin has been used in over 250 million transactions, prompting it to launch its own digital currency called UnikoinGold.
UnikoinGold will become the exclusive token for Unikrn’s betting platform and, because it is designed as a decentralized ERC20 token on the ethereum blockchain, can also be bought, sold and traded on digital currency exchanges.
ICOs have emerged as the easiest way for startup firms to raise capital for cryptocurrency ventures because they are unregulated and, therefore, face less rigorous obstacles than other fundraising methods. ICOs have managed to bring in about $327 million this year, according to a report by Quartz, representing slightly more than the $295 million that has been raised through traditional venture capital sources for blockchain-related tech startups.
Earlier this month, a project called Bancor raised the equivalent of about $150 million within two hours. However, there’s also been plenty of controversy surrounding ethereum. Last week, high demand for ICOs reportedly clogged ethereum’s network, causing prices to briefly fall from above $300 to 10 cents on one exchange. (See also: Ethereum's "Initial Coin Offering" Trend Becomes Wildly Successful.)