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Cramer says wait to buy bitcoin if you don't know the risk

  • "Mad Money" host Jim Cramer monitored bitcoin futures on their second day of trading on a public exchange and suggested a playbook for aspiring investors.
  • Cramer said he thought investors would benefit from waiting to see what happens as the digital currency gets "legitimized" on other exchanges.

As CNBC's Jim Cramer monitored bitcoin futures' second day of trading on the Cboe, he made two of his fundamental beliefs about equity futures clear.

"First, let me say this. As long as it's not against the law, I am supportive of anything that makes people money. Bitcoin has made people fortunes," the "Mad Money" host said. "Second, I hate it when experts try to keep other people out of securities or instruments that make you money."

One of Cramer's biggest pet peeves is hearing hedge fund managers talk about how the stock market is too risky for them or for individual investors.

Cramer said he was so glad he didn't listen to the people who told him for decades that stocks were too dangerous and too expensive.

Bitcoin is simply the latest outlet for this narrative, he added.

"Along comes bitcoin and its related cryptocurrencies, and while I'm concerned that they're too disorganized, too dark, too dependent on software that then can be hacked, I don't want to begrudge anyone from trying to profit from anything," the "Mad Money" host said.

The introduction of bitcoin futures, which started with the Cboe on Sunday and will continue with the CME and the Nasdaq, could finally help normalize the digital currency's volatile pattern, Cramer said.

Price discovery via futures may help firms get a handle on how much bitcoin should truly be worth, and having an "orderly market" in the largely unregulated entity will serve investors, he added.

But with bitcoin at risk of derailing gold's stability, Cramer advised that prospective buyers keep a watchful and cautious eye on the cryptocurrency.

"So far, I'm encouraged by the discipline that the new bitcoin futures seem to be injecting, although I'd like to see a lot more discipline," Cramer said. "Look, I never want to stand in the way of anyone making money as long as they know the risk. So if you want to put your money in bitcoin, please, ask yourself, do you know the risk? And if you do, be my guest. I'm not stopping you. If not, though, maybe you should be on the sidelines, because my first rule [is] do no harm."

WATCH: Cramer's early take on bitcoin futures

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