Senior Analyst Urges Investors to Take Advantage of Bitcoin Dip
A senior analyst specializing in digital assets at global asset management firm Alliance Bernstein, Gautam Chhugani, has advised investors to buy the dip in bitcoin, emphasizing the potential of the new bitcoin adoption cycle. In a client note reviewed by Yahoo Finance, Chhugani stated that the minor selloffs present opportunities due to the asymmetric upside ahead.
SEC Approves 11 Spot Bitcoin ETFs
Last week, the U.S. Securities and Exchange Commission (SEC) approved 11 spot bitcoin exchange-traded funds (ETFs), resulting in a surge in the price of bitcoin. However, the price subsequently dropped to around $42,000 after reaching over $49,000. As of now, BTC is trading at $43,170.14.
Alliance Bernstein's Bitcoin Price Prediction
In November of last year, Alliance Bernstein released a note predicting that the price of bitcoin would reach $150,000 by 2025. Chhugani explained that this optimistic forecast was driven by the anticipation of spot bitcoin ETF approval. The firm views bitcoin as a commodity and believes that the approval signifies a turning point in the market cycle.
Spot Bitcoin ETF Approval Seen as Landmark Moment
The approval of spot bitcoin ETFs by the SEC is widely regarded as a landmark moment for the cryptocurrency industry. Alesia Haas, the chief financial officer of crypto exchange Coinbase, described it as "a landmark day for crypto." However, she also acknowledged that this is just one step in the long journey towards widespread adoption of cryptocurrencies. Haas believes that spot bitcoin ETFs will attract trillions of dollars from investors who previously did not have access to crypto assets.
What are your thoughts on the recommendation to buy the bitcoin dip by the Bernstein analyst? Share your opinions in the comments section below.
Frequently Asked Questions
What should I pay into my Roth IRA
Roth IRAs are retirement accounts where you deposit your own money tax-free. The account cannot be withdrawn from until you are 59 1/2. There are some rules that you need to keep in mind if you want to withdraw funds from these accounts before you reach 59 1/2. First, you cannot touch your principal (the original amount deposited). This means that regardless of how much you contribute to an account, you cannot take out any more than you initially contributed. If you wish to withdraw more than you originally contributed, you will have to pay taxes.
The second rule says that you cannot withdraw your earnings without paying income tax. Also, taxes will be due on any earnings you take. Consider, for instance, that you contribute $5,000 per year to your Roth IRA. Let's further assume you earn $10,000 annually after contributing. You would owe $3,500 in federal income taxes on the earnings. You would have $6,500 less. This is the maximum amount you can withdraw because you are limited to what you initially contributed.
Therefore, even if you take $4,000 out of your earnings you still owe taxes on $1,500. On top of that, you'd lose half of the earnings you had taken out because they would be taxed again at 50% (half of 40%). So even though your Roth IRA ended up having $7,000, you only got $4,000.
There are two types: Roth IRAs that are traditional and Roth. A traditional IRA allows you to deduct pre-tax contributions from your taxable income. When you retire, you can use your traditional IRA to withdraw your contribution balance plus interest. You can withdraw as much as you want from a traditional IRA.
A Roth IRA doesn't allow you to deduct your contributions. Once you are retired, however, you may withdraw all of your contributions plus accrued interest. There is no minimum withdrawal amount, unlike traditional IRAs. It doesn't matter if you are 70 1/2 or older before you withdraw your contribution.
What is a Precious Metal IRA (IRA)?
An IRA with precious metals allows you to diversify retirement savings into gold and silver, palladium, rhodiums, iridiums, osmium, or other rare metals. These are called “precious” metals because they're very hard to find and very valuable. These metals are great investments and can help protect your financial future from economic instability and inflation.
Bullion is often used for precious metals. Bullion refers actually to the metal.
You can buy bullion through various channels, including online retailers, large coin dealers, and some grocery stores.
An IRA for precious metals allows you to directly invest in bullion instead of purchasing stock shares. This will ensure that you receive annual dividends.
Unlike regular IRAs, precious metal IRAs don't require paperwork or annual fees. Instead, you only pay a small percentage on your gains. Plus, you can access your funds whenever you like.
Should You Invest Gold in Retirement?
The answer will depend on how many dollars you have saved so far and whether you had gold as an investment option at the time. You can invest in both options if you aren't sure which option is best for you.
Not only is it a safe investment but gold can also provide potential returns. This makes it a worthwhile choice for retirees.
While many investments promise fixed returns, gold is subject to fluctuations. Its value fluctuates over time.
This doesn't mean that you should not invest in gold. You should just factor the fluctuations into any overall portfolio.
Another benefit of gold is that it's a tangible asset. Gold is more convenient than bonds or stocks because it can be stored easily. It can be easily transported.
You can always access your gold as long as it is kept safe. There are no storage charges for holding physical gold.
Investing in gold can help protect against inflation. Because gold prices tend to rise along with other commodities, it's a good way to hedge against rising costs.
A portion of your savings can be invested in something that doesn't go down in value. When the stock market drops, gold usually rises instead.
Investing in gold has another advantage: you can sell it anytime you want. As with stocks, your position can be liquidated whenever you require cash. You don’t even need to wait until retirement to liquidate your position.
If you do decide to invest in gold, make sure to diversify your holdings. Do not put all your eggs in one basket.
Do not buy too much at one time. Start with a few ounces. Continue adding more as necessary.
Remember, the goal here isn't to get rich quickly. Instead, the goal here is to build enough wealth to not need to rely upon Social Security benefits.
And while gold might not be the best investment for everyone, it could be a great supplement to any retirement plan.
Who holds the gold in a gold IRA?
The IRS considers anyone who owns gold to be “a form money” and therefore subject to taxation.
You must have at least $10,000 in gold and keep it for at most five years to qualify for this tax-free status.
Owning gold can also help protect against inflation and price volatility, but it doesn't make sense to hold gold if you're not going to use it.
If you plan to sell the gold one day, you will need to report its worth. This will affect how much capital gains tax you owe on cash you have invested.
You should consult a financial planner or accountant to see what options are available to you.
What are the benefits of a gold IRA
A gold IRA has many benefits. It is an investment vehicle that can diversify your portfolio. You decide how much money is put in each account and when it is withdrawn.
You have the option of rolling over funds from other retirement account into a gold IRA. If you are planning to retire early, this makes it easy to transition.
The best thing about investing in gold IRAs is that you don’t need any special skills. They're available at most banks and brokerage firms. You don't have to worry about penalties or fees when withdrawing money.
That said, there are drawbacks too. Gold is known for being volatile in the past. Understanding why you want to invest in gold is essential. Do you want safety or growth? Is it for insurance purposes or a long-term strategy? Only after you have this information will you make an informed decision.
If you are planning to keep your Gold IRA indefinitely you will want to purchase more than one ounce. A single ounce will not be sufficient to meet all your requirements. You may need several ounces, depending on what you intend to do with your precious gold.
A small amount is sufficient if you plan to sell your gold. You can even live with just one ounce. But, those funds will not allow you to buy anything.
Should You Purchase Gold?
In the past, gold was considered a haven for investors during economic turmoil. Many people are now turning their backs on traditional investments like stocks and bonds, and instead look to precious metals like Gold.
The trend for gold prices has been upward in recent years but they still remain low relative to other commodities like silver and oil.
This could be changing, according to some experts. According to them, gold prices could soar if there is another financial crisis.
They also note that gold is increasingly popular because of its perceived intrinsic value and potential return.
These are some things you should consider when considering gold investing.
- Consider first whether you will need the money to save for retirement. You can save money for retirement even if you don't invest in gold. That said, gold does provide an additional layer of protection when you reach retirement age.
- Second, make sure you understand what you're getting yourself into before you start buying gold.There are several different types of gold IRA accounts available. Each offer varying degrees of security and flexibility.
- Last but not least, gold doesn't provide the same level security as a savings account. Losing your gold coins could result in you never being able to retrieve them.
Do your research before you buy gold. You should also ensure that you do everything you can to protect your gold.
What precious metals could you invest in to retire?
It is gold and silver that are the best precious metal investment. They are both simple to purchase and sell, and they have been around for a long time. These are great options to diversify your portfolio.
Gold: Gold is one of man's oldest forms of currency. It is also extremely safe and stable. This makes it a good option to preserve wealth in uncertain times.
Silver: Investors have always loved silver. It's an ideal choice for those who prefer to avoid volatility. Silver, unlike gold, tends not to go down but up.
Platinium: Another form of precious metal is platinum, which is becoming more popular. It's durable and resists corrosion, just like gold and silver. It's also more expensive than the other two.
Rhodium – Rhodium is used to make catalytic conversions. It is also used for jewelry making. And, it's relatively cheap compared to other types of precious metals.
Palladium: Palladium, which is a form of platinum, is less common than platinum. It's also more accessible. For these reasons, it's become a favorite among investors looking to add precious metals to their portfolios.
- This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (smartasset.com)
- Contribution limits$6,000 (49 and under) $7,000 (50 and up)$6,000 (49 and under) $7,000 (50 and up)$58,000 or 25% of your annual compensation (whichever is smaller) (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)
- Instead, the economy improved, stocks rebounded, and gold plunged, losing 28 percent of its value in 2013. (aarp.org)
- 7 U.S. Code SS7 – Designation Boards of Trade as Contract Markets
- 26 U.S. Code SS 408 – Individual retirement account
The History of Gold as an Asset
From the beginning of history, gold was a popular currency. It was popular because of its purity, divisibility. uniformity. scarcity and beauty. Aside from its inherent value, it could be traded internationally. There were different measures and weights for gold, as there was no standard to measure it. For example, in England, one pound sterling was equal to 24 carats of silver; in France, one livre tournois was equal to 25 carats of gold; in Germany, one mark was equal to 28 carats of gold; etc.
The United States started issuing American coins in the 1860s made of 90% copper and 10% zinc. The result was a decrease in foreign currency demand, which led to an increase in their price. At this point, the United States minted large amounts of gold coins, causing the price of gold to drop. The U.S. government needed to find a solution to their debt because there was too much money in circulation. To do this, they decided that some of their excess gold would be sold back to Europe.
Most European countries distrusted the U.S. Dollar and began to accept gold as payment. Many European countries began to use paper money and stopped accepting gold as payment after World War I. The value of gold has significantly increased since then. Even though the price of gold fluctuates, it remains one the best investments you can make.
By: Kevin Helms
Title: Alliance Bernstein Analyst Recommends Buying Bitcoin Dip Amid SEC Approval of Spot ETFs
Sourced From: news.bitcoin.com/analyst-advises-investors-to-buy-the-bitcoin-dip-predicts-asymmetric-upside-ahead/
Published Date: Wed, 17 Jan 2024 02:30:02 +0000