CNBC’s Jim Cramer said Monday that he had dumped most of his Bitcoin holdings and expressed concern about the Chinese government’s recent crackdown on crypto mining and Bitcoin’s role in some ransomware attacks.
“I’ve sold almost all of my bitcoin. Don’t need it,” Cramer said on Squawk on the Street, more than two months after first hinting that he’d reduced his position and used those profits to pay off a mortgage.
Bitcoin price fell more than 6% on Monday to around $ 33,000 per token, roughly a two-week low. The decline follows a report in the Chinese Communist Party-backed Global Times newspaper that said more than 90% of the country’s mining capacity will be shut down after authorities shut down “many mines” in Sichuan Province.
China has housed more than half of the world’s mining capacity for years. Miners play a vital role in the Bitcoin ecosystem by using high-performance computers to verify transactions across the decentralized blockchain. In return, they are rewarded with Bitcoin.
“When the PRC persecutes something, they tend to get their way. … It’s not a democracy. It’s a dictatorship,” said Cramer, using an acronym for the People’s Republic of China. He added, “I think they believe it is a direct threat to the regime because what it is is a system that is beyond their control.”
Cramer – who previously described his Bitcoin ownership as an alternative to a cash position – said Tuesday he had concerns about how the U.S. government will approach the world’s largest cryptocurrency by market value in the face of the Colonial Pipeline attack.
Read more about cryptocurrencies from CNBC Pro
In this cyber incident, which cut gas supplies in the southeastern United States in May, the company paid the hackers a ransom of $ 5 million in Bitcoin. US law enforcement officials were able to reclaim $ 2.3 million of that payment.
“In our country, I think it’s beyond our control when it comes to ransomware, and I doubt Colonial will be the first company to pay for ransomware. I think they are the first to almost shut down the east coast, ”said Cramer. “I think the Department of Justice and the FBI and the Federal Reserve and the Treasury could join forces and say, ‘Okay, folks, if you pay for ransomware, we’re going to go after you.'”
Shortly after Colonial, another ransomware group targeted the world’s largest beef supplier. The Brazilian company JBS paid the hackers $ 11 million.
Looking at these two headwinds for Bitcoin, Cramer said, “I’m saying this will not increase for structural reasons.”