Mark Cuban, a well-known American entrepreneur, investor, and television personality, recently predicted that Ethereum’s ($ETH) value will surge in the future due to significant development within the Ethereum ecosystem. Cuban believes that developments such as Ethereum’s widely anticipated “Merge” event this summer will lead to increased use of the smart contracts blockchain, driving up its value.
As an investor in Ethereum-based L2 scaling platform Polygon, Cuban is likely well-acquainted with the potential of blockchain technology and its ability to disrupt traditional industries. His bullishness on the network is thus a compelling signal for other investors.
What Happened
In a new interview with Fortune, the billionaire reveals that he’s “very bullish” on Ethereum because of its upcoming merge event, which is the most significant upgrade in the blockchain’s history.
The “Merge” refers to the moment at which Ethereum’s main chain, which hosts 75% of all dApps, moves from a proof-of-work (PoW) mechanism to a proof-of-stake (PoS) one.
Cuban, who repetitively describes himself as an “Ethereum maximalist,” considers the network’s recent hard fork important for two key reasons.
First, it signals a move away from the current PoW consensus algorithm to a new PoS algorithm. This change could reduce Ethereum’s environmental impact, as proof-of-stake is far less energy-intensive than proof-of-work.
According to the Ethereum Foundation, the transition will slash Ethereum’s energy output by 99%.
Second, the merge will change Ethereum’s issuance model, resulting in a lower total supply of ETH. This could make Ethereum a more attractive investment for long-term hodlders, as the asset may become more deflationary over time.
Last month, crypto data firm IntoTheBlock estimated that the shift to PoS is expected to cut Ethereum’s issuance rate by about 90%.
A long-time crypto bull, Cuban mentioned to Fortune that he holds a significant amount of ETH, Ethereum-based NFTs, and has invested in some of the projects currently built on the Ethereum blockchain.
Price Action
The $390 billion market cap Ether is exchanging hands at about $3,200 at time of writing, a 3.5% drop intraday.
Disclaimer: The information provided is not trading advice
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