This is a segment from the Supply Shock newsletter. To read full editions, subscribe.
It’s nice to imagine a world where the price of bitcoin didn’t matter. Sadly, it can never be so.
Perhaps in a vacuum, maybe, in an alternate dimension where human brains are hardwired — like an ASIC miner — to only ever transact in bitcoin and nothing else. Not with shells, gold or livestock. Only bitcoin and barter, forever.
Hyperbitcoinization or bust.
In boring reality, bitcoin needs reference points. The ones we currently have may well be trending to zero, but Bitcoin could never fulfill its true calling — payments and storing value — without knowing exactly how much it’s worth relative to something else at any given moment.
Tracking exchange rates quickly turns into an obsession, and for good reason: That’s how fortunes are made.
Few know that better than Mark Cuban, my muse for today’s retrospective.
Money Is Speech
It’s been eight years exactly since this banger tweet about Bitcoin from the former majority Mavs owner Cuban:
“I think it’s in a bubble. I just don’t know when or how much it corrects. When everyone is bragging about how easy they are making $=bubble.”
It was June 2017, and bitcoin had been rallying for about six months straight to cap off a 10x run over two years — from $250 to $2,800 around the time of Cuban’s post.
Bitcoin would push 600% higher over the next six months until the cycle’s peak in December, before retracing by more than 80% across the following year.
Was that a bubble? It really depends on how loose your definition is, but for what it’s worth, bitcoin never returned to $2,800 again after Cuban’s post.
So, anyone who bought bitcoin as he sent that tweet would have never lost money, and would today be up by 3,600%.
Loading Tweet..
Nods in Jack Nicholson: “Unless everyone drops fiat, no one drops fiat.”
Cuban’s opinion about bitcoin and crypto has indeed evolved over time — the same guy who said “I’d rather have bananas than bitcoin” in October 2019 (when bitcoin was at $8,000) has more recently said “btc is probably a better buy right now” over stocks, even amid the buyback craze and with bitcoin at $84,000.
It’s not totally fair to surmise Cuban’s personal views from just his tweets and media spots. But I’ll do it anyway.
Cuban’s tendency is to consume Bitcoin through the very narrow lens of prices and profits, and he has certainly agreed with bitcoin’s potential as a store of value, even if it’s really a euphemism for “number go up.”
His most telling tweet is this, from August 2021, peak bull market: “BTC is a great SOV. Far better than gold. I own a bunch. But it is what it is. It doesn’t have all the special powers Maxis try to assign to it.”
Calling it now: If Bitcoinization is anything like the Apocalypse — 15 signs and all — then let the moment Cuban finally sees the magic of Bitcoin, beyond its price, be undeniable.
— David
A Historian’s View
To pull a quote from Harry Suddock, when it comes to Bitcoin — “price is the product,” but I’ll add my own twist. It’s also the marketing.
Since David has regaled us with a tale of just how late Mark Cuban has been to Bitcoin, I thought it would be nice to provide a reminder that we’re still early.
Take this quote from Zooko Wilcox, written 14 years ago:
