Jim Cramer poured cold water on latest Bitcoin rally, urging investors to ditch it for gold
Despite Bitcoin’s massive rise this month, CNBC’s Jim Cramer warned against entering the crypto space on Monday.
Referencing Carley Garner, senior commodities market strategist and broker at DeCarley Trading, Cramer warned investors to steer clear of cryptocurrencies and opt instead for gold as an inflation hedge or economic chaos.
Garner had reviewed the daily chart of bitcoin futures and the tech-heavy Nasdaq-100 dating back to March 2021, citing that they are trading at nearly the same rate. This indicates that Bitcoin is more of a risk asset, not a store of value.
Therefore, Cramer sees the shiny metal as a much better alternative to the world’s largest cryptocurrency.
The TV host also highlighted the counterparty risks associated with the flagship cryptocurrency in light of the FTX drama.
As U.Today reports, Bernstein saw a sharp rise following “mean reversion,” an investment phenomenon that occurs when assets whose prices have strayed too far from their typical values have tendency to return to their average price. overtime. According to this logic, the price of bitcoin is currently higher because the value of the cryptocurrency has fallen significantly from its all-time highs in late December and January of last year, creating an anomaly.