Though bitcoin is among the newest forms of currency, Mark Cuban says many investors treat it like one of the oldest: gold.

Interest in "gold isn't based off the supply and demand of jewelry," the billionaire investor said last week during an interview with Wired. "People see it as an option in the event of the economy going down or something bad happening."

Many people who hold bitcoin — the world's largest cryptocurrency — view it the same way, as a "great store of value," Cuban says. In a true economic crisis, bitcoin may even have an advantage, he says: "People look at bitcoin as a better version of gold, and I agree with that."

How gold and bitcoin could work as stores of value

A word that you'll hear gold investors use over and over is "hedge." Often, investors hope that gold can retain its value when problems arise and include the precious metal among their assets based on its reputation of holding up during periods of inflation. In reality, gold's record on that front is spotty.

In the more extreme example Cuban cites, where, say, the U.S. dollar collapses, gold's long-time reputation as a valuable currency could keep the holder from going broke. Here's the problem, though. Gold — especially in bar form — is heavy, easy to steal and difficult to exchange for goods and services.

It's not practical. "People aren't gonna walk around with gold bars. 'Oh, look, he owns gold.' Bam! 'Now I own gold,'" Cuban joked. "What are you gonna do with it? Let me slice you off a little piece?"

Despite its high price, bitcoin is portable and easier than precious metal to use for smaller transactions, Cuban said. So in addition to a serving as a store of value, bitcoin can be a functioning currency. "It's easier to buy and sell," he said. "You can fractionalize it, you can buy things, you can transfer it internationally. And so I think it has more value than gold."

Gold and bitcoin: the difference for investors

Most investors who hold gold or bitcoin aren't bracing for economic calamity. The major case for gold is that its price tends to fluctuate in different ways than major portfolio building blocks, such as stocks and bonds. During periods of market turmoil, many investors flee riskier assets to the perceived safety of gold, driving up the precious metal's price.

Bitcoin, on the other hand, is one of those riskier assets. Its value often moves in tandem with the stock market — just with much greater volatility.

Many investors hold crypto for the same reason that financial expert Suze Orman does: They think it's going to appreciate.

"As younger people make more money and mature, [bitcoin] will be one of their investments of choice, and that will cause it to go up," Orman recently told CNBC Make It. "I don't think it will ever be a currency or a store of value. But because the younger generation has a fascination with it — and you see the energy — a whole lot of people having interest in it, eventually it could very well catch fire."

Since the price of bitcoin moves based on investor demand, betting on it as an asset can be risky. Financial experts generally recommend sinking only as much money into cryptocurrency as you're willing to lose.

Given Cuban's wealth, it's unclear what that threshold would be for him. Still, his crypto holdings seem substantial. He told Wired's Lauren Goode that he owned enough bitcoin that he was really hoping the price would go up.

When Goode followed up to ask how much he held, he replied: "A lot."

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