Jim Cramer is a popular American television personality and a former hedge fund manager. Lately, his anti-crypto rhetoric has made him unpopular with the digital asset community. He is also called “Inverse Cramer” because crypto pumps each time he tells his audience to flee from it.
On live television this week. Cramer said that “Mister Bitcoin Is about to go down big”. A prediction that the top crypto asset is about to see a big crash. What is fueling his bearish view on Bitcoin? Is he correct?
Jim Cramer’s View on Bitcoin and Crypto Through the Years
June 2017: Cramer said that Bitcoin could reach $1 million. However, this stance is based on companies stockpiling Bitcoin to pay off hackers
Dec 2017: Cramer saw Bitcoin as monopoly money and it will be annihilated by short selling.
Aug 2018: Jim Cramer thought that the sun was setting on Bitcoin when it plunged to $6,000 from a high of $20,000.
June 2021: Cramer said that he is investing in Ethereum, after selling most of his BTC
June 2022: Jim Cramer, confirms that he owns Ethereum. He said he had to buy ETH to participate in an NFT bidding in a charity event. He said that his research shows that ETH has qualities he likes. Cramer also said that a portfolio should have no more than 5% crypto.
Oct 2023: The TV host expects Bitcoin to go down. The asset is currently trading at $27,000, after failing to retake the 30k level.
Snapshot:
In 2017, Cramer said that Bitcoin will get annihilated, however, the graph shows otherwise. The number one crypto asset even went from below $20,000 to an all-time high of $69,000. People who stayed away from BTC because of his prediction would have missed that parabolic move.
Looking at the chart, he probably sold most of his holdings around $25,000 in 2018. To be fair, that spared him from the pain of seeing Bitcoin plunged to the $16,000 level.
Why Does Jim Cramer View Crypto Negatively?
First, we need to understand that Jim Cramer is not just any television personality with an opinion. He is a legitimate financial professional who worked for Goldman Sachs. He was also a hedge fund manager and founder at Cramer Berkowitz. Cramer also co-founded TheStreet, a financial news and literacy website.
Based on Cramer’s statements through the years, he is not 100% against crypto. Rather, he favors other investment instruments, like gold, as a hedge against inflation. He did say that a portfolio can have up to 5% crypto. He said that he would not discourage investing in digital assets, but he is still wary of the risk.
The Mad Money host also said that he is not against crypto. He is against scammers using crypto to steal money, which is a valid point. Investors lost a lot of money due to fraudulent companies. The implosion of Terra (LUNA) and FTX proved this thesis.
Is Jim Cramer Right or Wrong?
An investment analyst’s job is to look at the risk and potential reward of a specific investment instrument. Jim Cramer probably made a lot of good calls in his long career. But nobody can accurately predict with 100% accuracy.
His predictions were based on the data he had available. There is no denying that he is correct in saying that crypto is being used by hackers to demand ransomware payments. He is also correct in saying that this asset class is risky and there are a lot of bad actors in the industry. He was just pointing out the obvious.
However, he did mention that a portfolio can have a little crypto. You might not agree with his suggested percentage, but it makes sense not to sell the farm to invest in a risky asset class.
Whether he likes crypto or not, there is no denying that Bitcoin has outperformed traditional assets since its inception. More countries, companies, and consumers are slowly realizing that Bitcoin and crypto are the future. He probably knows this, why do you think he agreed that a portfolio can have 5% in crypto?
