Jim Kramer, a popular presenter, (Mad Money) and (Investing Club) on CNBC, said that he believes in cryptocurrencies, but considers them only as speculative investments, which make up a small part of the portfolio — less than 5%, CNBC writes.

“I can’t say that it’s not worth owning cryptocurrencies, since I own Ethereum myself,” Jim Kramer said.

Kramer bought Ethereum in order to participate in bidding at a charity event for the sale of NFT, or non-interchangeable tokens.

“I wasn’t allowed to do it with dollars and I had to buy Ethereum, so I studied it and found some qualities that I like.”

Kramer is confident that the long—term value of cryptocurrencies “lies in their timeliness” – these are decentralized currencies that can become widespread over time and therefore recommends bitcoin and ethereum, which have the largest number of followers and seem to be the most legitimate.

Naturally, there is a small catch in this: owning cryptocurrencies can be a good short-term bet that uses the momentum from fluctuations in the price of such a currency, but it should be recognized that this is a speculative investment, and such a bet may not pay off. As with any investment, past performance is not a guarantee of future returns.

The recent downturn in the cryptocurrency market underscores this risk, since it is impossible to know in advance how much the cryptocurrency may fall in price. That’s why experts usually advise investors to invest as much money as they are not afraid to lose.

Kramer believes that in no case should you borrow money to buy cryptocurrencies: “Borrow for a house, borrow for a car, but do not borrow for cryptocurrencies.”

The investor also advises treating cryptocurrencies differently than safer long-term investments, such as blue chip stocks. “Don’t put it [cryptocurrencies] in the Procter class & Gamble (NYSE:PG), Coca-Cola (NYSE:KO), or Apple (NASDAQ:AAPL).”

Kramer recommends allocating no more than 5% of investments for cryptocurrencies, as well as up to 5% for gold, another speculative investment.

Despite the inherent risks of owning cryptocurrencies, Kramer is not going to dissuade anyone from them thanks to “all the fortunes that were earned on them.”

previously Jim Kramer

During the Mad Money program, Jim Kramer said that he supports investors buying cryptocurrencies if they are aware of all the risks associated with this emerging asset class. According to him, all arguments in favor of cryptocurrencies are based on the theory of the greater fool, according to which there will always be someone who is ready to buy an asset for a higher price in the calculation of quickly reselling it with profit to other people.

This strategy is doomed to failure when there are no more “fools”, as a result of which the value of assets drops sharply. If people understand this, why not speculate on cryptocurrencies, Kramer said. Previously, Kramer preferred to invest in gold and stocks, but last year he called bitcoin an effective means to hedge inflation risks. He said he has been criticized repeatedly for recognizing cryptocurrencies. Nevertheless, Kramer believes that it is important to diversify the investment portfolio, 5% of which can be bitcoin or ether. At the same time, the program host spoke about cryptocurrencies quite contradictory

I didn’t buy bitcoin and ether to protect myself from inflation. To be honest, it was something like gambling for me. I was just playing on crowd psychology, and I have no idea why the rate of these crypto assets went up. Most likely, there are many overly enthusiastic people who want to sell them more expensive. I have no attachment to the ether, but I keep it, because millions of even bigger fools can buy it

In April of this year, Jim Kramer called himself a “renegade” and announced the sale of half of his assets in the first cryptocurrency