Mark Cuban is backing a new cryptocurrency fund months after calling bitcoin a ‘bubble’

Mark Cuban is singing a different tune when it comes to cryptocurrencies.

The tech billionaire and “Shark Tank” star is an early backer of a new cryptocurrency fund, according to CoinDesk, which reports on blockchain and cryptocurrency news.

The fund, 1confirmation, launched Tuesday, plans to invest exclusively in cryptocurrency assets, according to a filing with the Securities and Exchange Commission. Its founder, Nick Tomaino, a principal at the $US270 million Palo Alto-based investor Runa Capital, is looking to raise $US20 million.

“I think Nick is one of the sharpest minds in the space, and I’m a big believer that there will be transformational apps built on blockchain,” Cuban told CoinDesk.

Cuban said in a tweet last week that he was looking to jump on the bitcoin bandwagon:

Cuban’s financial interest in the digital-currency world is an about-face for the billionaire, who two months ago called it a “bubble.” In early June, soon after bitcoin hit what was then a near record high of $US2,900 a coin, Cuban warned of a coming correction:

Cuban then turned his focus to cryptocurrencies as a whole:

Cuban’s change of heart represents a pivot across Wall Street. Financial firms and institutional investors are waking up to the profit potential in cryptocurrencies as bitcoin and ether, its rival powered by the Ethereum blockchain, reach new heights — they’re up more than 350% and 2,000%, respectively, since the beginning of the year.

For instance, VanEck, the New York-based money manager with $US24.7 billion in assets, is seeking to launch a bitcoin exchange-traded fund, according to an August 11 SEC preliminary filing. Additionally, Goldman Sachs is telling clients that cryptocurrencies are worth their attention.

In a recent note to portfolio managers, the Goldman analyst Robert Boroujerdi and his team wrote:

“With the total value nearly $US120 billion, it’s getting harder for institutional investors to ignore cryptocurrencies. Whether or not you believe in the merit of investing in cryptocurrencies (you know who you are) real dollars are at work here and warrant watching especially in light of the growing world of initial coin offerings (ICOs) and fundraising that now exceeds Internet Angel and Seed investing.”

ICOs, a fundraising method powered by blockchain, have raised over $US1.8 billion since the beginning of the year, according to Autonomous Next, a fintech-analytics firm.

According to CoinDesk, 1confirmation “will make initial investments in the $US100,000 to $US500,000 range” in “legal vehicles designed to help investors pre-purchase tokens or equity prior to an ICO.”

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