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Wall Street Madman's Investment Advice to Powerball Jackpot Winner in the US: "Put 5% in Bitcoin!"

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Wall Street Madman

CNBC's "Mad Money" host Jim Cramer has offered some investment advice to the latest Powerball jackpot winner in the United States. His suggestion is for the winner to invest 5% of the winnings in assets such as Bitcoin, gold, and real estate.

5% in Bitcoin

Last week, an individual in the United States won the Powerball jackpot worth approximately $731.1 million, making it the fourth-largest jackpot in Powerball history and the sixth-largest in U.S. lottery history. The news of the winning ticket immediately sparked discussions nationwide. Jim Cramer, host of CNBC's "Mad Money" and former hedge fund manager on Wall Street, offered asset allocation advice to the lucky winner on Friday. Cramer compiled a list of investment recommendations, including precious metals, real estate, art, municipal bonds, dividend stocks, and Bitcoin.

Source: CNBC

Cramer explained that when one becomes so wealthy, the primary concern should not be taxes but rather inflation, especially hyperinflation, which is the only factor that truly threatens nine-digit wealth. During hyperinflation, scarce assets such as precious metals, real estate, and art are the truly valuable assets. He recommended that the winner allocate 5% of the jackpot to gold. Following that, Jim Cramer continued:

"If you win the lottery, go for it, yes, what I'm saying is 'put 5% into Bitcoin'."

Cramer stated that Bitcoin will be a significant value storage tool. However, he advised the winner not to make a one-time purchase and to avoid buying on weekends due to the extreme volatility in the cryptocurrency market. Besides offering investment strategy advice, Jim Cramer also provided some conventional suggestions to the Powerball jackpot winner, such as opting for a lump-sum payment rather than receiving the prize in annuity form.

"Definitely choose the lump sum. You can put that money into bonds, and the interest it generates will certainly exceed the returns from using annuities."

From Advocating Gold to Embracing Bitcoin

Jim Cramer has long been an advocate of gold. However, in September 2020, during an interview with Morgan Creek Capital partner Anthony Pompliano, Cramer expressed concerns about the potential for a massive inflation crisis and began considering buying Bitcoin, despite his unwavering faith in gold. By December, when the price of Bitcoin dropped below $18,000, Cramer publicly announced that he would buy Bitcoin (BTC).

Subsequently, in an interview, Cramer stated that cryptocurrency assets, along with other investment commodities, could make his portfolio more diversified:

"When prices drop, I buy as usual. My position will become larger and larger. I want to cover various asset classes as much as possible. I have gold, and I will diversify with some Bitcoin, which is not a significant portion for me, but asset diversification is crucial. Bitcoin is an asset, and I want to have a balanced portfolio."