Crypto a scam? Jim Cramer Sounds the Alarm After Calling Ethereum ‘Fantastic’ and Becoming ‘A Believer’

Jim Cramer is fickle when it comes to stock recommendations. The same could be said for cryptocurrencies.

What happened: The CNBC host sounded the alarm over the cryptocurrency sector on Monday after previously advising viewers to invest. He labeled cryptocurrency industry events “Crypto Monday,” spearheaded by Celsius and others that pause transactions and withdrawals in user accounts.

“I don’t want to make a joke out of this. A lot of young people and people who borrowed money will leave today if they’re not careful,” Cramer said.

Cramer added that he is hearing pessimistic opinions from his contacts in Silicon Valley, with some calling cryptocurrencies “a scam.”

Cramer mentioned large cryptocurrency platform marketing campaigns, including a ad campaign featuring Matt Damon as reasons why more people are speculating in the cryptocurrency sector.

“This is what happens in these situations. People who have invested heavily in crypto will come and take a stand,” she added, likening the sentiment to a medieval war drama. “It’s Braveheart.”

Cramer called the drop in cryptocurrency prices as Bitcoin USD/BTC Y Ethereal EUR/USD a “necessary cleansing of speculation”.

Because it is important: Many on social media were quick to point that on April 28, Cramer was recommending people to buy Ethereum.

“I think Ethereum is fantastic,” he said. “I am a believer.”

Cramer told viewers that he thought Ethereum could rise 35-40%, but instead the cryptocurrency is down more than 50% since the episode.

“Fortunes are made in crypto,” Cramer said on June 8 saying he was a “believer” in crypto.

On Monday, Cramer said that he took his money out of Ethereum and broke even on his original investment.

Cramer has previously warned that investors should view the sector as a speculative investment and make it less than 5% of their portfolio.

“Don’t put it in the Procter & Gamble class. It’s not Coca-Cola, it’s not Apple.”

Cramer said that investors should never borrow money to invest in cryptocurrencies.

Some on social media, including Solarium SOL/USD co-founder Anatoly Yakovenko he even predicted that Cramer would change his mind about cryptocurrencies with falling prices.

“A major fund is also due to close and Cramer will deliver some bearish crypto prose,” Yakovenko tweeted.

doecoin DOGO/USD co-creator billy marcos he hit Cramer back by saying, “Jim, sometimes you gotta shut up.”

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