Mark Cuban, billionaire investor and “Shark Tank” star, said that the currently “insane” volume of non-fungible tokens (NFTs) being developed is not sustainable.

On a panel at the SXSW conference in Austin, Texas, Cuban compared the current NFT craze to the dot-com bubble, when anyone set up websites and raised funds.

“I was around during the early days of the internet and it was crazy,” he said. “It’s very similar to what’s happening with cryptocurrencies, in particular NFTs.”

“Everyone and their brother has an NFT and it’s hard to tell the difference between signal and noise,” Cuban said, adding that the NFT market is peaking in “supersonic time.”

During the dot-com craze, “projects like NFTs were popping up now,” he said. “Does anyone think they will be sustainable and long-lasting? …No.”

That is not to say that some NFTs will not survive. He pointed to Amazon and eBay as companies that took advantage of the dot-com bust and prospered.

Participatory Entertainment

Cuban also talked about a startup he backs called Fireside, which he thinks is where entertainment is headed.

The future of entertainment will be interactive rather than one-way. For example, when people create podcasts, they don’t know how the audience reacts to their message. This makes things difficult for creators who rely on podcasts for a living.

Falon Fatemi, CEO of Fireside who was also on the panel, said his startup invented the technology to allow the creator to “virtually feel the audience” when the audience claps or reacts to content. “It allows the audience to be part of the content creation.”

Cuban added that such interactivity changes the entire dynamic of content creation. “Finding new ways to connect is important, and that’s what we’re trying to do.”

Celebrities at Fireside include Cuban, Jay Leno, and the late Bob Saget.

Web 3.0 is more than technology

When asked how disruptive Web 3.0 will be, Cuban said the technology side is “easy. The hard part is staying engaged.”

For example, he said, people who buy real estate in the metaverse should be concerned with building a community.

What makes real estate valuable? “Location, location, location,” Cuban said. Why is location important? That’s where the people are. For the metaverse to be “real”, it has to foster community.

Otherwise, the money spent on buying metaverse real estate will be wasted, especially since “there are no barriers to entry” in creating a virtual world, he said. “You put six people on Zoom or a VR channel, that’s your metaverse.”

One good thing about decentralized Web 3.0 is that content creators will finally be paid what their work is worth.

People don’t have to rely on a technology platform to share content when they can do it peer-to-peer. It also improves the chance for creators to get paid multiple times.

For example, a poet writes a poem and sells it. When the buyer resells the poem to someone else, the original creator also receives compensation.

When this happens, Cuban said, the poet can lower the initial price of the poem since he or she will continue to receive compensation when the contents change hands.

Today’s mega social media platforms are the gatekeepers of content, he said. In a decentralized web, “it’s harder to be a gatekeeper in a crypto universe, and that’s a good thing.”

This article first appeared in IoT World Today’s sister publication AI Business.