The order imposes a 90-day ban affecting citizens from Iran, Iraq, Libya, Somalia, Sudan, Syria and Yemen and a 120-day bar on all refugees. A federal judge suspended the order after Washington state challenged it. Nearly 130 technology companies filed an amicus brief in support of Washington as a federal appeals court hears the challenge.
Trump argued Wednesday that the administration made the move hastily to prevent terrorism. His administration has repeatedly said it moved quickly to stop potential threats from "pouring in" to the U.S., though it has given no evidence to back an increased threat.
Rascoff said the order has been perceived abroad as a ban on the Muslim faith, sparking dangerous propaganda.
"We think it's bad for business, we think it's bad for the country, and frankly we don't think it makes the country safer, I think it makes us less safe," Rascoff said. "It cuts at the very center of the culture of the country, which welcomes refugees."
Rascoff told CNBC's "Squawk on the Street" on Wednesday that he only speaks out on issues like housing and technology that directly affect his company, which provides technology to help in the buying, selling renting and financing of homes. He said the recent executive order is one such issue.