CNBC analyst Jim Cramer has a buy call on Bitcoin and Ethereum
Source: Wit Olszweski – Shutterstock
- Jim Cramer believes that Bitcoin and Ethereum are the best crypto bets for the long term however cautions that cryptos are not like blue-chip stocks.
- Cramer says cryptos are speculative investments and that investors should allocate not more than 5 percent of their portfolio.
Bitcoin and the broader cryptocurrency market are exhibiting totally uncertain and volatile behavior over the last few weeks. Bitcoin has been trading in the zone of $29,000 to $31,500 and has been a nightmare for traders recently.
But in a recent proposition, CNBC analyst Jim Cramer said that he’s a “believer” in cryptocurrencies and recommends buying BTC and ETH. However, he said that investors should take it as a speculative investment and not allocate more than 5 percent of their portfolio.
“I can’t tell you not to own crypto; I own Ethereum,” he added. Cramer said that his initial purchase of Ethereum was only to buy an NFT at a charity event. “They wouldn’t let me do dollars,” he says. “I had to buy it in Ethereum, so I researched it, and it’s got some qualities I like.”
Being a believer in crypto himself, Cramer sees some strong long-term value in digital assets. He said that cryptos are timeless as decentralized and peer-to-peer currencies, and believes that they would see greater adoption over the long term. He also thinks that Bitcoin and Ethereum are in for the long term and they “seem the most legitimate”.
The market analyst also said that one should not compare crypto to other long-term investments or blue-chip stocks. “Don’t put it in the Procter & Gamble class. It’s not Coca-Cola, it’s not Apple,” he says.
Short-term crypto bets could be risks
With the rapid growth of the crypto market, crypto trading has become very prominent these days. People have been betting on crypto for the short term taking the advantage of momentum swings in the crypto prices. However, Cramer warns about some inherent risks that come with crypto trading.
“You must admit that it’s speculative,” said Cramer adding that the bets may not pay off. Also, he reminded traders that past performance is no guarantee of future returns. The recent downturn in the crypto market has proved to be a wild ride for investors and traders.
Furthermore, the recent episode and collapse of the Terra ecosystem is a stark reminder that one can lose money overnight in crypto. Just as there’s no limit to top rally, there’s no limit to correction in crypto. As a result, Cramer adds one more piece of advice that one must never borrow money to buy crypto. “Borrow for your house, borrow for your car — but don’t borrow for crypto.”
But despite this recent carnage, Cramer said that he would not discourage someone from not owning crypto. He said that in the past, investors have made fortunes from crypto investing and will continue to do even in the future. “I’d like that to be you,” he says.
Source: Wit Olszweski – Shutterstock Jim Cramer believes that Bitcoin and Ethereum are the best crypto bets for the long term however cautions that cryptos are not like blue-chip stocks. Cramer says cryptos are speculative investments and that investors should allocate not more than 5 percent of their portfolio. Bitcoin and the broader cryptocurrency market…
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