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Markets commentator and CNBC host, Jim Cramer, has made headlines once again, this time by openly admitting his earlier misjudgment regarding Bitcoin. Cramer, known for his outspoken views and fluctuating relationship with cryptocurrencies, tacitly acknowledged that he was wrong about the world's leading digital asset, expressing regret for prematurely advising investors to sell their Bitcoin holdings.
Meanwhile, Renowned economist Robin Brooks, serving as the chief economist at the Institute of International Finance (IIF), has ignited a significant debate by boldly branding Bitcoin as a "pointless asset." His provocative statement attributes Bitcoin's market behavior more to Federal Reserve policies than its intrinsic value.
Jim Cramer Acknowledges Premature Bitcoin Bearish Call, Admits Mistake
The revelation came during a recent segment of Cramer's CNBC Mad Money show on November 22, when he responded to a caller's query about investing in CleanSpark, a Bitcoin mining company. In a surprising twist, Cramer took a markedly different stance, stating, "Look, if you like Bitcoin, buy Bitcoin. That has always been my view. And for a while, I liked it, and I decided that money had been made, but I was premature."
Cramer's about-face on Bitcoin investment advice was a significant departure from his previous stance just a year earlier. On Dec. 5, when Bitcoin was trading at a relatively modest $17,150, Cramer urged investors to divest themselves of all their cryptocurrency holdings, regardless of the cost. He emphatically stated that it was "never too late to sell an awful position." However, since that call, Bitcoin's price has experienced a remarkable resurgence, surging by 118%.
While Cramer openly admitted his premature judgment on Bitcoin, he also noted that despite some missteps in the past, he had managed to profit significantly from his own investments in the cryptocurrency. The juxtaposition of these contradictory calls and his ability to profit from the volatile cryptocurrency market has made Cramer a lightning rod for criticism and a source of entertainment within the investing community.
Cramer's unpredictable and often inconsistent views on cryptocurrencies have not gone unnoticed by market participants. Over the past few years, his comments have become the subject of widespread online memes, with many traders and investors humorously highlighting his knack for making incorrect calls at crucial moments.
One particularly memorable incident occurred in August 2022 when a crypto trader claimed to have doubled the size of their portfolio by doing precisely the opposite of what Cramer recommended. This tongue-in-cheek strategy proved highly lucrative during the ensuing Bitcoin bull run, earning the trader a substantial windfall.
In another instance of Cramer's influence on the market, an investment fund filed for an "inverse Cramer ETF" in October 2022. This unique financial instrument was designed to provide returns that are the opposite of, before fees and expenses, the results of investments recommended by television personality Jim Cramer. The filing itself garnered significant attention, reflecting the polarizing nature of Cramer's investment advice within the financial world.
Economist Robin Brooks Labels Bitcoin a "Pointless Asset," Citing Federal Reserve Influence
In a striking critique of Bitcoin (BTC), Robin Brooks, the chief economist at the Institute of International Finance (IIF), has ignited a debate by labeling the world's leading cryptocurrency a "pointless asset." Brooks attributes Bitcoin's market movements primarily to Federal Reserve policies rather than its intrinsic value. This controversial statement has emerged as Bitcoin surges to a new high of $38,437 on the Bitstamp exchange, marking its highest level since May 2022. The rally has been fueled by the resolution of the Binance legal saga and anticipation surrounding "spot bitcoin" exchange-traded funds (ETFs).
Bitcoin: Not an Independent Asset?
Brooks' assertion that Bitcoin essentially behaves like "just another futures contract on the Fed" implies that the cryptocurrency's value and market behavior are substantially influenced by the Federal Reserve's monetary policies, rather than being driven by its own intrinsic merits. This perspective challenges the widely held view of Bitcoin as a decentralized and independent digital asset, operating outside the realm of traditional financial institutions.
The economist suggests that investors might be better off directly engaging with futures contracts that allow them to bet on the Federal Reserve's monetary policy moves. According to Brooks, Bitcoin's price fluctuations are merely a reflection of broader economic policies and sentiments, rather than being indicative of its value as an autonomous asset.
Brooks' Past Criticisms of Bitcoin
Robin Brooks has been a consistent critic of Bitcoin's perceived independence, frequently emphasizing its correlation with the Federal Reserve's interest rate policies in his social media posts. This view is substantiated by historical data showing that the price of Bitcoin often responds negatively to the Fed adopting a hawkish stance while rising in response to a dovish outlook.
Furthermore, Brooks has previously dismissed the idea of Bitcoin as a reliable store of value or a means of diversification in investment portfolios. He has publicly labeled Bitcoin a "bubble asset," suggesting that it remains highly vulnerable to shifts in monetary policy and macroeconomic factors.
While Brooks' critique has stirred controversy within the cryptocurrency community, it is essential to acknowledge that Bitcoin's relationship with broader financial markets and government policies has always been a topic of debate. Some argue that Bitcoin's resilience and potential as a hedge against traditional financial systems make it a valuable asset, while others share Brooks' concerns regarding its susceptibility to external influences.
As Bitcoin continues to evolve and integrate into global financial systems, opinions on its true nature and value will remain diverse. The ongoing discussion sparked by Robin Brooks' assertion serves as a reminder that the cryptocurrency landscape is continually evolving, with perspectives on its role in the broader financial ecosystem continuing to shape the market's narrative.
Price Overview
Daily chart for BTC/USDT (Source: TradingView)
BTC was able to break above the key $38K mark during yesterday’s trading session, but bears capitalized on this strong move quickly. This forced the market leader’s price to close the daily candle off at $37,713.57. In the past 24 hours, the cryptocurrency’s value has risen 0.25%, and stood at $37,806.99 at press time, according to TradingView data.
BTC may have the momentum needed to overcome the $38K resistance once more in the next 48 hours as buyers were growing stronger on the cryptocurrency’s charts. This was signaled by the Relative Strength Index (RSI) indicator. At press time, the RSI line was rising towards the RSI Simple Moving Average (SMA) line. Traders normally identify the narrowing gap between the RSI and RSI SMA lines as bullish when the RSI line is positioned below the RSI SMA line.
If these two lines cross, it may suggest that buyers have re-entered BTC’s charts and could attempt to drive the leading cryptocurrency’s price up. If this bullish thesis is validated, BTC could overcome the $38K barrier and continue to climb to the subsequent mark at $40K through the course of the following few days.
On the other hand, BTC failing to close a daily candle above $38K within the next 48 hours may lead to a slight pullback. As a result, the cryptocurrency’s value could drop to the immediate support level at $36,880.
