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Dave Ramsey's Team Insists Crypto Isn't a Good Investment — Says It's 'Risky for a Lot of Reasons'

source-logo  news.bitcoin.com 13 February 2024 07:55, UTC

Personal finance expert and best-selling author Dave Ramsey’s firm Ramsey Solutions has maintained that crypto is not a good investment. “We’re not saying cryptocurrency is going to go away. And we’re not saying it’s horrible … But as things stand today, just say no,” advised the Ramsey Solutions team.

Ramsey Solutions Advises ‘Just Say No’ to Crypto

Ramsey Solutions (Ramsey), the company founded by personal finance expert Dave Ramsey as a means to provide financial counseling and education, published an article earlier this month titled “Is crypto a good investment?” Dave Ramsey is an eight-time national best-selling author and the host of The Ramsey Show. The article is credited to “Ramsey,” which could refer to a member of the Ramsey Solutions team of writers and financial experts.

“Crypto isn’t a good investment because of risks like volatility, an unproven rate of return, and fraud,” Ramsey began, elaborating:

The road to building wealth is slow and steady, and there are still way too many unknowns when it comes to cryptocurrency. Could crypto become a more legit way to invest later on down the road? Maybe. But as things stand today, just say no.

“Get-rich-quick schemes are just that — schemes. Don’t risk it and pour all your hopes, dreams, and money into them,” the article notes.

“Plain and simple — investing in cryptocurrency is not a good way to build wealth for your future. Now, we’re not saying cryptocurrency is going to go away. And we’re not saying it’s horrible. But we are saying that crypto doesn’t have a proven track record of building wealth,” Ramsey clarified.

“Cryptocurrency is exchanged person-to-person on the web without a middleman (like a bank or government). It’s like the Wild West of the digital world — but there’s no marshal to uphold the law. Because crypto has very few regulations, there’s no pattern to the rise and fall of its value. You can’t figure out the changes or calculate returns like you can with growth stock mutual funds. There just isn’t enough data, or enough credibility, to create a long-term investing plan based on cryptocurrency. Don’t play poker with your financial future here,” the author detailed.

Ramsey also explained that hackers stole $400 million of crypto in the first three months of 2023, emphasizing: “Crypto just seems to attract seedy characters.” While noting that not all crypto users are “dodging the government and making shady deals on the black market,” Ramsey said: “If someone wanted to commit a crime and fly under the radar without being tracked, cryptocurrency is going to call their name.”

Moreover, the author pointed out that the U.S. government is looking into creating a central bank digital currency (CBDC). “If a U.S. CBDC becomes a reality, there’s no telling how it would impact the value of cryptocurrencies,” Ramsey warned, concluding:

Crypto is risky for a lot of reasons. But the big reason it’s not a safe investment is because it can have huge swings in price in the blink of an eye. In the investing world, that’s called volatility. And volatility isn’t good for an investment portfolio.

Dave Ramsey has long been skeptical of crypto and bitcoin. He said several times on his Ramsey Show that they are not good investments. In December 2020, the self-proclaimed personal finance expert said he doubted that bitcoin could be cashed out, advising investors to sell immediately. Following the collapse of crypto exchange FTX, he reiterated his crypto warning. Nonetheless, he stated in 2022 that crypto is fun, is here to stay, and can be part of a portfolio.

What do you think about Dave Ramsey’s and Ramsey Solutions’ crypto advice? Let us know in the comments section below.