Mark Cuban has presented a case for DeFi through a tweet thread where he has mentioned Robinhood, GameStop as well as short selling.
Mark Cuban is a billionaire investor and has recently been hedging big bets on the cryptocurrency industry. The owner of Dallas Mavericks has also recently been selling NFTs (Non- Fungible Tokens), He has been referencing his holdings of Coinbase. In addition, he is also talking about the advantages of DeFi (decentralized finance).
A Case On DeFi
Mark Cuban has lately made a strong case for DeFi through a tweet thread about the buying spree of GameStop (GME) with the help of Robinhood which is an app for stock trading. The blockchain-based suite app helps in removing some of the intermediaries present in the procedure of both lendings as well as trading.
Cuban has pointed this out in the tweet that the business model of Robinhood collects fees that would have gone to users without DeFi.
Cuban has tweeted that when the stock goes short which is very short, they need to pay some amount of fees in order to borrow some of the stock back. Referring to this case of the fee of GameStop has been inching near 30% throughout this whole week.
Additionally Cuban has stated that the shorts need to pay a per-day price of (Price*0.30)/360. On the other hand, in DeFi the fee to be paid is an APY of 30%.
To understand what Cuban is trying to say is that it is essential to get down in the weeds for a little amount. Also borrowing a specific stock is not the same as buying it. There is a fee involved in it. It is Robinhood who keeps the entire fee.
