Mark Cuban is scrutinizing a key sector of the crypto markets after getting burned by Iron Titanium Token (TITAN), which plummeted from an all-time high of $64.19 on June 16th to zero within a day.
The billionaire entrepreneur says stablecoins, which are altcoins designed to be pegged to the value of more stable currencies like the dollar, may need to be regulated. TITAN is part of a collateralized stablecoin ecosystem along with the token IRON.
Says Cuban in a comment to Bloomberg,
“There should be regulation to define what a stablecoin is and what collateralization is acceptable. Should we require $1 in US currency for every dollar or define acceptable collateralization options, like US treasuries…?”
The Dallas Mavericks owner also calls for stablecoin registration because “they likely need to get to hundreds of millions or more in value in order to be useful.”
Iron Titanium Token pumped roughly 2x in value after Cuban mentioned in a blog post on June 13th that he was a liquidity provider for TITAN on the DeFi exchange Quickswap.
The billionaire says he actually got out of his position with Iron Finance, but got back in when the project’s Total Value Locked (TVL) started to rise.
“As a percentage of my crypto portfolio it was small. But it was enough that I wasn’t happy about it.”
Traders on Twitter are hailing Cuban as a “DeFi Degen,” a badge of honor meaning he’s deep enough in the crypto rabbit hole to have lost money on an ill-fated project.
Well done on getting out Mark. You truly are a Degen yield farmer now. pic.twitter.com/YYdpiXO1dD
— DΞFI F⟠RMΞR 🦇🔊 (@OG_Etherean) June 16, 2021
In a “post-mortem” report after the price crash, Iron Finance says it is a victim of “the world’s first large-scale crypto bank run.”
“What we just experienced is the worst thing that could happen to the protocol, a historical bank run in the modern high-tech crypto space.
Remember that Iron.finance is a partially collateralized stablecoin, which is similar to the fractional reserve banking of the modern world. When people panic and run over to the bank to withdraw their money in a short period, the bank may and will collapse.”Don't Miss a Beat – Subscribe to get crypto email alerts delivered directly to your inbox
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Featured Image: Shutterstock/Greg Kushmerek