Jim Cramer, the host of CNBC's Mad Money and co-founder of The Street, has bought some Bitcoin and outlined his strategy to increase his holdings as the price declines. The former hedge fund manager explained his purchase rationale, highlighting the importance of diversification across asset classes.
Entry Point: Buying Bitcoin Near $17,000
In response to a comment about a dip in Bitcoin's price, Cramer tweeted on Friday, “I think I will buy some.” Hours later, he confirmed on The Street that he had indeed executed the purchase. At the time, Bitcoin had just fallen back to the $17,000 level. “It was simply a decent level,” he said. Describing his approach, Cramer added, “I will buy like I usually do. As something comes down, I'll get bigger and bigger and bigger. I just think that you want to diversify into all sorts of asset classes.”
Diversification: Bitcoin Alongside Gold
Cramer emphasized that his Bitcoin purchase is part of a broader asset allocation strategy. “I have gold,” he continued. “I want to diversify into some Bitcoin, not a big position for me but it's certainly important to be diversified and Bitcoin is an asset and I want to have a balance of assets.” This aligns with his earlier comments from September, when he said he was considering buying Bitcoin because he feared a “massive amount of inflation.” He also expressed concern about leaving inheritance to his children, noting that they “would not feel comfortable with gold but would feel comfortable with crypto.”
Strategy: Patience for Pullbacks
When asked how an investor should start buying Bitcoin, Cramer offered pragmatic advice: “You just have to recognize the history of it that it ran up and then ran down. It got too much money, got too hot so there's no reason not to wait for it to come down again.” He explained that his Friday purchase was made when the price was “off nicely from the top, and I like to buy something that's off nicely from the top.” This “buy the dip” strategy reflects his long-term value investing background. Cramer's public entry into Bitcoin underscores a growing acceptance of digital assets among mainstream financial figures, who now view them not as speculative fads but as legitimate portfolio diversifiers.