CNBC’s Jim Cramer said on Tuesday that he believes cryptocurrencies such as bitcoin and ether perform different functions than gold in a wallet, suggesting that investors may be exposed to both.
Supporters of gold or bitcoin often present their respective assets as long-term stores of value to protect against inflation and irresponsible government spending. However, the host of “Mad Money” told him, “It’s not one or the other.”
“At the end of the day, I believe in both gold and crypto,” Cramer said, while adding that he saw “absolutely no reason to treat these two things as equivalent in any way. ‘another one”.
Gold has a rarity value and has been proven to work over time, Cramer said. “I see gold as a long-term inflation insurance policy; it’s boring, but absolutely essential.”
Bitcoin and ether, on the other hand, have created “ridiculous fortunes” in recent years, but they are still nascent and, as a result, can be very volatile, Cramer said. Bitcoin was created in 2009, and the Ethereum blockchain, on which Ether is the native digital currency, was founded in 2013.
Cramer said he viewed them both as “speculative trading.”
“Maybe crypto will be a store of value when it goes up, but it’s a colossal mistake when it goes down,” Cramer said. “That’s not what I’m looking for in an insurance policy. You don’t speculate with insurance. Crypto absolutely has its advantages if you are willing to take additional risks to look for big gains, but it does. protecting yourself is very different. “
Cramer has previously invested in both bitcoin and ether, which are the two largest cryptocurrencies in the world in terms of market value.
“The value of gold is its timelessness; the value of crypto is its timeliness. You want insurance? Buy gold. You want to speculate, buy bitcoin or Ethereum, but don’t confuse the two “said Cramer.