Billionaire Mark Cuban is so confident that his two favorite stocks and the top cryptocurrencies will outperform the S&P 500 index over the next decade, that he’s willing to bet $2 million on that outcome.
The “Shark Tank” investor and Dallas Mavericks owner has agreed to a pair of wagers with Peter Mallouk, the CEO of Creative Planning, a wealth-management firm.
Cuban tweeted he will stake $1 million on a 50-50 split of Netflix and Amazon stock beating the benchmark over the next 10 years. He will bet another $1 million on Mallouk’s choice of either bitcoin or ethereum doing the same. Mallouk will bet on the S&P 500 in both cases.
The two men agreed to make the two bets this week after butting heads over the value of a diversified portfolio and the long-term viability of cryptocurrencies. The argument was sparked by Mallouk criticizing Cuban for promoting dogecoin, then predicting that 99% of cryptocurrencies will end up worthless, and touting stocks as superior to crypto.
“If you buy a hundred stocks, odds are most go up,” Mallouk tweeted. “If you buy a hundred cryptocurrencies, most will go to zero. Big difference.”
“Only a fool would buy 100 stocks or 100 crypto assets,” Cuban replied. To settle their dispute, Cuban and Mallouk agreed to convert $4 million into crypto, set up smart contracts that will automatically pay the victors in 10 years’ time, and donate the proceeds to charity.
The pair’s bet echoes a famous wager between billionaire investor Warren Buffett and hedge-fund manager Ted Seides in 2007. Buffett staked $1 million on the S&P 500 besting a basket of hedge funds over the course of a decade, and won.