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CNBC’s Jim Cramer has sold virtually all of his Bitcoin holdings, saying that negative fundamentals will keep the price of Bitcoin low for the foreseeable future.
Jim Cramer, anchor of CNBC’s Mad Money, has stated that he has sold virtually all of his Bitcoin (BTC) holdings.
Speaking on June 21 during an interview with CNBC’s Squawk Box on the Street, Cramer asserted that BTC is ”not going up because of structural reasons,” highlighting China’s renewed regulatory clampdown.
Cramer stated that China’s central government understands Bitcoin to be a “direct threat” to the regime and its capacity to control monetary flows within the country, describing the cryptocurrency as “as a system that’s outside of their control.”
The increasing Chinese crypto mining ban has driven Bitcoin’s hash rate to an eight-month low as mining firms shut down or relocate offshore. China is also cracking down on cryptocurrency trade, with the central bank encouraging other banks and payment firms, such as Alipay and Wechat, to suspend services for accounts connected with cryptocurrency trading activities.
Cramer also stated that BTC’s reduction in hash rate should have resulted in price increases, stating: “Instead of believing that bitcoin should go up if it is prohibited or made harder to mine, Bitcoin falls down as if people are saying ‘I’ve got to redeem’ — when you limit mining, it should obviously go up unless there’s a worldwide redemption.”
“Sold almost all of my Bitcoin. Don’t need it.”
The Mad Money presenter also warned that US officials may take action against companies who pay ransomware attacks, discouraging enterprises from dealing with crypto assets.
Cramer cited a $4.4 million Bitcoin ransomware assault on the Colonial Pipeline in May, which momentarily created gasoline shortages in the south-east area of the United States and resulted in law enforcement agencies stepping in to collect $2.3 million in BTC.
“When it comes to ransomware, I believe it is beyond our control in our country, and I doubt that Colonial is the first company to pay ransomware. “I believe they are the first to almost shut down the East Coast,” he said, adding:
“The Justice Department and the FBI and the Federal Reserve and Treasury could coalesce and say: ‘OK guys, if you pay ransomware, we’re going to go after you.’”
Cramer also cited Tether as a structural “weak link” that underpins the crypto market, noting persistent controversy regarding the reserves backing USDT.
“They haven’t really told us what kind of commercial paper backs them, and yet they’re one of the largest buyers, and yet I can’t find anyone, any desk that does business with them,” he explained.
This is not the first time Cramer has stated that he has sold BTC. He claimed in April that he had sold out part of his stocks to pay down his mortgage, characterising the experience as “phoney money paying for real money.”
According to CoinGecko statistics, the price of Bitcoin has dropped by 42 percent from the beginning of the crypto market slump in mid-May, falling from $56,928 on May 12 to roughly $31,750 today.