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Cramer Warns Investors to Stay Away from Crypto and Stick with Gold

Jim Cramer, host of CNBC's "Mad Money," warned investors to avoid crypto despite recent gains and instead look to gold.

Jim Cramer
Jim Cramer

Cramer cited charts interpreted by Carley Garner, senior commodity market strategist and broker at DeCarley Trading, as evidence that gold is a better hedge against inflation or economic chaos.

In his analysis, Cramer compared the daily chart of Bitcoin futures and the tech-heavy Nasdaq-100 from March 2021. According to Garner, the two indexes are almost trading in lockstep, which suggests that bitcoin is a risk asset rather than a currency or stable store of value.

Cramer also pointed out that the close trading relationship between the two indexes is due to "counterparty risk," or the likelihood that the other party in an investment or transaction will not fulfill their end of the deal. He noted that owning bitcoin directly in a decentralized wallet can protect against counterparty risk, but using it for transactions reintroduces that risk. In contrast, gold is a more durable option.