American billionaire and investor Mark Cuban believes Dogecoin (DOGE) has the potential to become a usable currency if more companies adopt the meme cryptocurrency for their products and services.
Dogecoin as a Potential Usable Currency
On May 3, famed Shark Tank investor Mark Cuban took to Twitter to say that Dogecoin may hold its purchasing value better than a dollar in the bank.
According to him, if more companies take the meme-based cryptocurrency for products and services, it might eventually become a usable currency.
“If interest rates skyrocket or the amount spent falls or stagnates, so will Doge. Yes, a joke is now legit,” he adds.
Meme coins like Doge only work if they gain utility and users use them for that utility. As long as you can spend Doge , because we know it's annual inflation rate is set at 5b coins, it can gain SOME value as the utility grows. It becomes like any other currency…
— Mark Cuban (@mcuban) May 2, 2021
In early March, Mark Cuban’s Dallas Mavericks NBA team started accepting Dogecoin for buying merchandise products and tickets.
Since then, major companies, including online e-commerce company, Newegg started accepting the meme-based cryptocurrency for purchasing their products.
Dogecoin Better as a Currency Instead of Store of Value
Dogecoin has an inflationary supply with 5.2 million new coins entering into circulation every year.
This is believed to be one of the cryptocurrency’s main negative points as the more amount of coins enter the market, the harder it will be to sustain current price levels.
Cuban noted that Dogecoin’s annual inflation rate is set at five billion coins. According to him, it means for the cryptocurrency to continue gaining any significant value it needs to gain utility.
Cuban, however, sees Dogecoin’s infinite supply as its strength since it can be used as a digital currency instead of a store of value, saying:
“Any asset that has inflation by definition is “infinite” but that doesn’t diminish it. It changes the utility from a store of value to potentially a digital currency.”
The billionaire investor further noted that Bitcoin is easy to trade, store and create with no delivery issues while enabling the transfer of value locally as well as globally. In comparison to Bitcoin, Gold is a hassle in all the mentioned points.