CNBC’s Jim Cramer endorsed the purchase Coinbase on its public debut Wednesday he said he was impressed with the business model and leadership team of the popular cryptocurrency exchange.
However, should the stock rally get out of hand, investors need to be disciplined not to chase as they will likely be volatile after listing directly on the Nasdaq, he said.
“If you like me, [are] a big believer in cryptocurrency … you will want to own Coinbase for the long term, “the”Bad money“Host said.
“What is important to me is that there is a huge appetite for this new asset class and it is not going away. You don’t have to believe in Crypto the Concept to believe in Crypto the Investment,” he said.
Coinbase, the The hottest stock to hit the market so far this year, could be a victim of bad timing in the near future, Cramer said. The market’s appetite for the new entrant may put pressure on other technology stocks as some investors reduce their holdings of growth names to raise money for Coinbase.
“I think Coinbase is the real deal – the numbers are incredible – but I hate the timing,” he said. “One of my biggest fears right now is that we have a glut of growth, just too many of these things, especially in the technical area.”
One appeal from Coinbase is that the exchange be tied to the powerful Bitcoin, Cramer said. Bitcoin, the flagship of crypto assets, hit new highs above $ 63,000 on Tuesday. Coinbase was founded in 2012 and supports trading in a wide variety of cryptocurrencies. including Ethereum and Litecoinwhile making money with commissions.
One cause for concern is that too much initial demand could take Coinbase’s shares to extreme levels, Cramer said. In that scenario, a great buying opportunity could open up if early investors drop stocks and take profits, leading to a big sell-off, he said.
“I say buy something tomorrow, ideally for less than $ 475, but I accept that something has to be bought,” advised Cramer. “Then wait to buy more about weakness and prepare for the bumpiest ride of your financial life, a ride that I expect to be lucrative in the long run.”