Welcome to the Senate Banking Committee’s recent event, “From Wall Street to Web3: Building Tomorrow’s Digital Asset Markets,” where U.S. senators and industry experts delved into the world of digital asset market structure.
The Role of Cryptocurrency in Illicit Finance
The Balance of Legitimate vs. Illicit Activities
Let’s kick off with the debate on crypto’s involvement in illicit finance. Senator Scott highlighted that cash, not crypto, is primarily used for illegal activities. However, Senator Warren raised concerns about the surge in illicit activities as crypto’s market capitalization grows. She pointed out instances like North Korea hacking billions in crypto, posing a threat to U.S. national security.
Jonathan Levin shed light on the fact that illicit activities on blockchains are minimal, accounting for less than 1% of overall transactions. In contrast, traditional markets witness higher illicit activity. Levin emphasized that the majority of blockchain activities are legitimate.
Despite the challenges posed by crypto mixers in monitoring criminal activities, Chainalysis noted a lower-than-expected usage of crypto mixers in terrorist financing cases.
Unveiling the Trump Family’s Conflict of Interest
Examining Ethical Concerns
The discussion then shifted to the conflict of interest involving President Trump and his family's ties to the crypto industry. Senators raised ethical questions about advocating for crypto legislation while being actively involved in the sector.
Richard W. Painter highlighted the ethical dilemma of passing legislation related to crypto when conflicts of interest are present, labeling it as a significant financial violation by a sitting president.
Navigating Regulatory Jurisdiction: SEC vs. CFTC
Collaboration for Effective Regulation
There was a consensus during the hearing that both the SEC and CFTC should collaborate to regulate the digital asset industry effectively. The emphasis was on a principles-based approach to ensure industry growth and innovation.
It was suggested that a principles-based regulatory regime would be beneficial, preventing overly restrictive regulations that could stifle industry progress.
Recognizing Bipartisan Efforts in Legislation
Promoting Collaboration for Progress
Senator Bernie Moreno highlighted the bipartisan nature of crypto issues, emphasizing the need for balanced regulation. Senators Lummis and Gillibrand were praised for their collaborative efforts in drafting legislation, setting a benchmark for sensible crypto regulation.
Senator Lummis underscored the importance of clear regulations to support innovators in the digital asset space, ensuring a conducive environment for growth and economic empowerment.
As we pave the way for the future of digital assets, it’s crucial to establish clear guidelines that foster innovation while addressing ethical concerns. Let’s work together to shape a regulatory framework that benefits both industry players and consumers alike.
Frequently Asked Questions
Is it a good idea to open a Precious Metal IRA
It is essential to be aware of the fact that precious metals do not have insurance coverage before opening an IRA. It is impossible to get back money if you lose your investment. All your investments can be lost due to theft, fire or flood.
You can protect yourself against such losses by purchasing physical gold and silver coins. These items have been around thousands of years and are irreplaceable. If you were to offer them for sale today, they would likely fetch you more than you paid when you bought them.
Consider a reputable business that offers low rates and good products when opening an IRA. A third-party custodian is a good option. They will protect your assets while giving you easy access whenever you need them.
Do not open an account unless you're ready to retire. Remember the future.
Should You Buy Gold?
Gold was considered a safety net for investors during times of economic turmoil in the past. Many people today are moving away from stocks and bonds to look at precious metals, such as gold, as a way to diversify their investments.
The trend for gold prices has been upward in recent years but they still remain low relative to other commodities like silver and oil.
Experts believe this could change soon. Experts predict that gold prices will rise sharply in the wake of another global financial collapse.
They also pointed out that gold is gaining popularity due to its perceived value, and potential return.
Here are some things to consider if you're considering investing in gold.
- The first thing to do is assess whether you actually need the money you're putting aside for retirement. It is possible to save for retirement while still investing your gold savings. However, when you retire at age 65, gold can provide additional protection.
- Second, be sure to understand your obligations before you purchase gold. Each type offers varying levels and levels of security.
- Finally, remember that gold doesn't offer the same level of safety as a bank account. Your gold coins may be lost and you might never get them back.
If you are thinking of buying gold, do your research. Make sure to protect any gold you already own.
Is buying gold a good way to save money for retirement?
Although gold investment may not seem appealing at first glance due to the high average global gold consumption, it's worth considering.
Physical bullion is the most popular method of investing in gold. You can also invest in gold in other ways. Research all options carefully and make an informed decision about what you desire from your investments.
If you don't want to keep your wealth safe, buying shares in companies that extract gold and mining equipment could be a better choice. If you require cash flow, gold stocks can work well.
You can also put your money in exchange traded funds (ETFs). These funds allow you to be exposed to the price and value of gold by holding gold related securities. These ETFs may include stocks that are owned by gold miners or precious metals refining companies as well as commodity trading firms.
How to Open a Precious Metal IRA
It is important to decide if you would like an Individual Retirement Account (IRA). You must complete Form 8606 to open an account. Next, fill out Form 5204. This will determine the type of IRA that you are eligible for. This form must be submitted within 60 days of the account opening. Once you have completed this form, it is possible to begin investing. You might also be able to contribute directly from the paycheck through payroll deduction.
If you opt for a Roth IRA, you must complete Form 8903. Otherwise, it will be the same process as an ordinary IRA.
To be eligible to have a precious metals IRA you must meet certain criteria. The IRS stipulates that you must have earned income and be at least 18-years old. You cannot earn more than $110,000 annually ($220,000 if married filing jointly) in any one tax year. Contributions must be made regularly. These rules apply to contributions made directly or through employer sponsorship.
A precious metals IRA can be used to invest in palladium or platinum, gold, silver, palladium or rhodium. You can only purchase bullion in physical form. This means you can't trade shares of stock and bonds.
You can also use your precious metals IRA to invest directly in companies that deal in precious metals. Some IRA providers offer this option.
There are two major drawbacks to investing via an IRA in precious metals. First, they are not as liquid or as easy to sell as stocks and bonds. This makes them harder to sell when needed. Second, they don’t produce dividends like stocks or bonds. You'll lose your money over time, rather than making it.
Can the government take your gold?
The government cannot take your gold because you own it. You worked hard to earn it. It belongs to you. This rule could be broken by exceptions. You could lose your gold if convicted of fraud against a federal government agency. Additionally, your precious metals may be forfeited if you owe the IRS taxes. However, if you do not pay your taxes, you can still keep your gold even though it is considered property of the United States Government.
How Does Gold Perform as an Investment?
The supply and demand for gold affect the price of gold. It is also affected by interest rates.
Due to their limited supply, gold prices fluctuate. There is also a risk in owning gold, as you must store it somewhere.
How do I Withdraw from an IRA with Precious Metals?
You first need to decide if you want to withdraw money from an IRA account. Then make sure you have enough cash to cover any fees or penalties that may come with withdrawing funds from your retirement plan.
An IRA is not the best option if you don't mind paying a penalty for early withdrawal. Instead, open a taxable brokerage. If you decide to go with this option, you will need to take into account the taxes due on the amount you withdraw.
Next, you need to determine how much money is going to be taken out from your IRA. The calculation is influenced by several factors such as your age at withdrawal, the length of time you have owned the account and whether or not you plan to continue contributing to retirement plans.
Once you have an idea of the amount of your total savings you wish to convert into cash you will need to decide what type of IRA you want. While traditional IRAs are tax-free, Roth IRAs can be withdrawn at any time after you reach 59 1/2. However, Roth IRAs will charge income taxes upfront and allow you to access your earnings later without additional taxes.
After these calculations have been completed, you will need to open a brokerage bank account. Many brokers offer signup bonuses or other promotions to encourage people to open accounts. Avoid unnecessary fees by opening an account with your debit card, rather than your credit card.
When you do finally decide to withdraw from your precious metallic IRA, you will need a safe space where you can safely store your coins. Some storage areas will accept bullion, while others require you to purchase individual coins. Either way, you'll need to weigh the pros and cons of each before choosing one.
Because you don't have to store individual coins, bullion bars take up less space than other items. You will need to count each coin individually. However, you can easily track the value of individual coins by storing them in separate containers.
Some people like to keep their coins in vaults. Some people prefer to store their coins safely in a vault. Whichever method you choose, make sure you store your bullion safely so you can enjoy its benefits for years to come.
Statistics
- (Basically, if your GDP grows by 2%, you need miners to dig 2% more gold out of the ground every year to keep prices steady.) (smartasset.com)
- If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (lendedu.com)
- You can only purchase gold bars at least 99.5% purity. (forbes.com)
- If you accidentally make an improper transaction, the IRS will disallow it and count it as a withdrawal, so you would owe income tax on the item's value and, if you are younger than 59 ½, an additional 10% early withdrawal penalty. (forbes.com)
- The price of gold jumped 131 percent from late 2007 to September 2011, when it hit a high of $1,921 an ounce, according to the World Gold Council. (aarp.org)
External Links
finance.yahoo.com
irs.gov
cftc.gov
bbb.org
How To
Investing with gold or stocks
Investing in gold as an investment vehicle might seem like a very risky proposition these days. This is because many people believe gold is no longer financially profitable. This belief is due to the fact that many people see gold prices dropping because of the global economy. They feel that gold investment would cause them to lose money. There are many benefits to investing in gold. Below we'll look at some of them.
The oldest form of currency known to mankind is gold. It has been used for thousands of years. It is a valuable store of value that has been used by many people throughout the world. It continues to be used in South Africa, as a way of paying their citizens.
The first point to consider when deciding whether or not you should invest in gold is what price you want to pay per gram. When looking into buying gold bullion, you must decide how much you are willing to spend per gram. You could contact a local jeweler to find out what their current market rate is.
It's worth noting, however, that while gold prices have fallen recently the cost of producing gold is on the rise. The price of gold may have fallen, but the production costs haven’t.
The amount of gold that you are planning to purchase is another important consideration when deciding whether or not gold should be bought. If you intend to only purchase enough gold to cover your wedding rings it may be a smart decision to not buy any gold. But, if your goal is to make long-term investments in gold, this might be worth considering. It is possible to make a profit by selling your gold at higher prices than when you purchased it.
We hope that this article has helped you gain a better understanding and appreciation for gold as an investment option. Before making any investment decisions, we strongly advise that you thoroughly research all options. Only after doing so can you make an informed decision.
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By: Frank Corva
Title: Demystifying Misconceptions and Revealing Conflicts of Interest at Senate Banking’s Crypto Market Structure Hearing
Sourced From: bitcoinmagazine.com/news/myths-busted-and-conflicts-of-interest-noted-at-senate-banking-crypto-market-structure-hearing
Published Date: Wed, 09 Jul 2025 19:17:55 +0000
