Just because Jim Cramer believes in bitcoin doesn’t mean he won’t grab the chance to sell high.
Bitcoin has started gaining some pretty aggressive hype from mainstream investors, with Wall Street legends Stanley Druckenmiller and Paul Tudor Jones onboard, along with mainstream companies like MicroStrategy insurer Mass Mutual
And, of course, CNBC “Mad Money” host Jim Cramer, who recently declared the first cryptocurrency to be a legitimate asset with a place in investors’ portfolios.
That said, Cramer also told The Street on Dec. 11—talking about a dot-com bubble-like atmosphere in IPOs, not crypto, it should be noted—”When you have these 50-60% gains in a week or 100% gains over three weeks, check out. Let someone else make the next 100%.”
Bitcoin was at $18,160 on Dec. 11. Three weeks later it was north of $29,000, and a week after that cracking $40,000. Which is to say, a $100%-plus gain in four weeks, which is close enough to Cramer’s timeframe not to matter.
He followed his own advice. Cramer told CNBC on Jan. 11 that he sold enough of his bitcoin holding to cover what he spent buying it, and did so before the price crashed this weekend. It is down by nearly a quarter since Friday.
Saying his “goal was to get my cash out so I don’t have to think about it,” Cramer noted that he is now “playing with the house’s money. This is no different than an entirely erratic stock.”
He added that he’d only buy back into bitcoin soon if it drops below $20,000. Cramer said:
“If it goes back under $20,000, I’m a buyer again.”
A market unlike any other
What Bitcoin investors have to recognize, Cramer said, is that “this market is not any like any of other market you’ve ever seen.” He added:
“We don’t know who’s buying, we don’t know who’s selling. We don’t know what’s going on. We don’t know anything about where it’s going.”
With those conditions, Cramer said his advice has been to “take something off the table if you’re up big, and everybody’s still up big at $32,000.”
Except for those who “unfortunately came in at $42,000,” said Cramer, noting, “I say unfortunate, ‘cause I was a seller.”
That said, he also noted that liquidity remains a big problem in the bitcoin market.
“I tried to do a trade in Bitcoin over the weekend,” he said. “It’s really, really hard to do.” He added:
“We need liquidity in this darn thing. We don’t have it.”