Mark Cuban, star of Shark Tank and owner of the Dallas Mavericks NBA team, has warned that the next cryptocurrency implosion could come from the “discovery and removal of wash trades” on centralized exchanges. The billionaire’s comments followed the collapse of cryptocurrency exchange FTX that wiped out billions of dollars of client funds.
Mark Cuban on the next crypto implosion
Shark Tank star and NBA Dallas Mavericks team owner Mark Cuban shared his thoughts on the upcoming crypto implosion with The Street, released on Friday. The billionaire said:
I think the next possible implosion is the discovery and removal of wash trades on central exchanges.
“There are allegedly tens of millions of dollars in trading and liquidity for tokens that have very limited use,” Cuban pointed out. “I don’t see how they can be so liquid.”
However, the Shark Tank star admitted, “I have no details to offer to support my hypothesis.”
Wash trading has long been a concern with cryptocurrency exchanges attempting to inflate their trading volumes. Wash trades are among the manipulative practices banned by the Securities and Exchange Commission (SEC), and regulators around the world are increasingly cracking down on wash trading involving cryptocurrencies.
Kim Grauer, director of research at blockchain analytics firm Chainalysis, said in September last year that wash trading in the cryptocurrency space is currently “a legal gray area that we’re all trying to figure out how it should be regulated and what is illegal”.
The cryptocurrency industry is also suffering from the aftermath of the collapse of cryptocurrency exchange FTX, which filed for bankruptcy in November. Former FTX CEO Sam Bankman-Fried (SBF) has been charged with multiple counts of fraud. However, he has pleaded not guilty to those charges.
Cuban said in November that if he were Bankman-Fried, he would be “afraid of going to jail for a long time.” He stressed, “he sure sounds bad.” The billionaire owner of the Dallas Mavericks previously explained that recent blowouts in the crypto space, including the FTX implosion, were “banking blasts,” rather than “crypto blasts.”
Shark Tank star believes bitcoin is a good investment; you called gold investors “stupid”. She also revealed that she invests in cryptocurrencies because she expects smart contracts “to have a significant impact in creating valuable applications.”
Do you think Mark Cuban is right about the upcoming cryptocurrency implosion coming from laundering exchanges on centralized exchanges? Let us know in the comments section below.
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