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Shares of Square were 2.5 percent higher Wednesday, trading near $41 share, in the wake of the reports that the company is testing support for bitcoin through its Cash payments app. Square said the test does not allow individuals or businesses to send or accept bitcoin.
"I think this is something big and it's going to drive Square up, and it's going to make people feel better about bitcoin," Cramer said on "Squawk on the Street. "
Bitcoin traded more than 9 percent higher on Wednesday, according to CoinDesk, and has hit new record highs several times this year. The digital currency has risen more than 600 percent year to date.
Not everyone on Wall Street has bitcoin fever. JPMorgan Chase CEO Jamie Dimon said in September that bitcoin is "a fraud" and that "eventually it will be closed." The CEO later said he would no longer talk about the cryptocurrency.
—CNBC's Evelyn Cheng contributed to this report.