Jim Cramer, the host of the financial TV show Mad Money, has recently increased his bitcoin position by buying “nicely from the top.” He also advised investors who want to enter the BTC market to do it with caution and be aware of the asset’s notorious volatility.
Cramer Doubles-down on Bitcoin
The popular TV host changed his mind on bitcoin earlier this year, as he admitted on Anthony Pompliano’s podcast. He asserted that the actions undertaken by the US Federal Reserve during the COVID-19 pandemic had highlighted BTC’s merits.
Later on, Cramer continued praising the cryptocurrency and its attributes to serve as a store of value. This time, he compared BTC with the ultimate store of value asset – gold.
In a recent interview, he doubled-down on his bullish stance on bitcoin by revealing his latest BTC purchase. In fact, he bought more during last week’s price slumps when the primary cryptocurrency dipped to $17,500.
Apart from taking advantage of this “buy the dip” opportunity, Cramer noted that he usually continues to buy more as the asset price slumps.
He described his bitcoin position as “not a big one,” but it’s “certainly important to diversify.” As such, BTC enables him to have a “balance of assets,” that also includes gold.
Beware Of Historic Volatility
With the Q4 2020 bull run that resulted in bitcoin reaching a new all-time high, the cryptocurrency has garnered the attention of new investors. As reported in late November, the number of newly created addresses on the BTC network reached the highest levels since January 2018.
This data, however, raised speculations if people are chasing the wind in a classic example of FOMO (fear of missing out). Cramer warned potential investors to be aware of such possible scenarios and also to be prepared to experience high levels of fluctuations. If they are willing to show some patience, they might be able to get in at a better price:
“You just have to realize the history of it. It went up and then went down. It got too much money; it got too hot. So, there’s no reason not to wait for it to come down again.”