The Securities and Futures Commission (SFC) in Hong Kong has issued a reminder to cryptocurrency investors in the region to only use or trade on approved virtual asset trading platforms (VATP). In a statement released on February 5, 2024, the SFC emphasized the importance of verifying a VATP's regulatory status before engaging in any transactions.
Importance of Verifying Regulatory Status
The SFC's latest warning comes after previously urging users to avoid unlicensed operators. According to the regulator, many of these entities have little chance of obtaining a license. To ensure investor protection, the SFC encourages crypto investors to pay close attention to the two lists of VATPs – one for licensed entities and another for those that have applied for a license.
The SFC clarifies that VATPs featured on the 'List of licensed virtual asset trading platforms' have received formal licensing from the SFC. On the other hand, VATPs on the 'List of virtual asset trading platform applicants' are those operating in Hong Kong that have submitted license applications to the SFC on or before February 29, 2024.
Consequences for Non-Compliant VATPs
The SFC also highlights that Virtual Asset Service Providers (VATPs) failing to submit their license applications by February 29 will be required to cease operations by May 31. In light of this, the SFC advises crypto investors who are using VATPs not featured on either list to close their accounts or consider transferring their funds to licensed VATPs.
Regarding VATPs on the applicants list, the SFC cautions that their applications are still being processed and, therefore, trading on these platforms carries a certain level of risk. The SFC concludes its statement by emphasizing the importance of avoiding unapproved VATPs as they do not offer any form of investor protection.
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Frequently Asked Questions
Can I buy gold using my self-directed IRA
Your self-directed IRA can be used to purchase gold, but first you need to open an account with a brokerage firm such as TD Ameritrade. Transfer funds from an existing retirement account are also possible.
Individuals can contribute as much as $5,500 per year ($6,500 if married filing jointly) to a traditional IRA. Individuals are allowed to contribute $1,000 each ($2,000 if married or filing jointly) to a Roth IRA.
If you do decide to invest in gold, you'll want to consider purchasing physical bullion rather than investing in futures contracts. Futures contracts, which are financial instruments based upon the price of gold, are financial instruments. These financial instruments allow you to speculate about future prices without actually owning the metal. You can only hold physical bullion, which is real silver and gold bars.
Is it a good idea to open a Precious Metal IRA
Precious metals are not insured. This is the most important fact to know before you open an IRA account. If you lose money in your investment, nothing can be done to recover it. This includes losing all your investments due to theft, fire, flood, etc.
This type of loss can be avoided by investing in physical silver and gold coins. These coins have been around for thousands and represent a real asset that can never be lost. If you were to sell them today, you would likely receive more than what you paid for them when they were first minted.
When opening an IRA account, make sure you choose a reputable company offering competitive rates and high-quality products. 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. So, don't forget about the future!
How much tax is gold subject to in an IRA
The fair market price of gold when it is sold determines the tax due on its sale. You don't have tax to pay when you buy or sell gold. It's not considered income. If you decide to make a sale of it, you'll be entitled to a taxable loss if the value goes up.
As collateral for loans, gold is possible. Lenders will seek the highest return on your assets when you borrow against them. Selling gold is usually the best option. This is not always possible. They might just hold onto it. Or they might decide to resell it themselves. In either case, you risk losing potential profits.
To avoid losing money, only lend against gold if you intend to use it for collateral. If you don't plan to use it as collateral, it is better to let it be.
Are You Ready to Invest in Gold?
This will depend on how much money and whether you were able to invest in gold at the time that you started saving. Consider investing in both.
You can earn potential returns on your investment of gold. It's a great investment for retirees.
While most investments offer fixed rates of return, gold tends to fluctuate. This causes its value to fluctuate over time.
This doesn't mean that you should not invest in gold. This just means you need to account for fluctuations in your overall portfolio.
Another benefit to gold is its tangible value. 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. Plus, there are no storage fees associated with 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.
Also, you'll reap the benefits of having some savings invested in something with a stable value. When the stock market drops, gold usually rises instead.
Another benefit to investing in gold? You can always sell it. Like stocks, you can sell your position anytime you need 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. You shouldn't try to put all of your eggs into one basket.
You shouldn't buy too little at once. Start small, buying only a few ounces. Add more as you're able.
Keep in mind that the goal is not to quickly become wealthy. Rather, it's to build up enough wealth so you won't need to rely on Social Security benefits.
Although gold might not be the right investment for everyone it could make a great addition in any retirement plan.
What are the benefits of having a gold IRA?
The best way to invest money for retirement is by putting it into an Individual Retirement Account (IRA). It is tax-deferred until it's withdrawn. You can decide how much money you withdraw each year. There are many types and types of IRAs. Some are better suited for college students. Others are intended for investors seeking higher returns. For example, Roth IRAs allow individuals to contribute after age 59 1/2 and pay taxes on any earnings at retirement. The earnings earned after they withdraw the funds aren't subject to any tax. This account is a good option if you plan to retire early.
An IRA with a gold status is like any other IRA because you can put money into different asset classes. Unlike a regular IRA that requires you to pay taxes on the gains you make while you wait to access them, a gold IRA does not have to do this. People who prefer to save their money and invest it instead of spending it are well-suited for gold IRAs.
An additional benefit to owning gold through an IRA, is the ease of automatic withdrawals. This means that you don't need to worry about making monthly deposits. You could also set up direct debits to never miss a payment.
Gold is one of today's most safest investments. Because it isn’t tied to any specific country, gold’s value tends to stay stable. Even during economic turmoil, gold prices tend to stay relatively stable. This makes it a great investment option to protect your savings from inflation.
What is a Precious Metal IRA and How Can You Benefit From It?
A precious metal IRA allows for you to diversify your retirement savings in gold, silver, palladium and iridium. These rare metals are often called “precious” as they are very difficult to find and highly valuable. These are good investments for your cash and will help you protect yourself from economic instability and inflation.
Bullion is often used to refer to precious metals. Bullion refers to the actual physical metal itself.
Bullion can be bought via various channels, such as online retailers, large coin dealers and grocery stores.
With a precious metal IRA, you invest in bullion directly rather than purchasing shares of stock. This will ensure that you receive annual dividends.
Precious Metal IRAs don’t require paperwork nor have annual fees. Instead, your gains are subject to a small tax. Plus, you get free access to your funds whenever you want.
Can I keep a Gold ETF in a Roth IRA
Although a 401k plan might not provide this option, you should still consider other options like an Individual Retirement Account (IRA).
A traditional IRA allows contributions from both employee and employer. Another way to invest in publicly traded companies is through an Employee Stock Ownership Plan.
An ESOP is a tax-saving tool because employees have a share of company stock as well as the profits that the business generates. The money invested in the ESOP is then taxed at lower rates than if it were held directly in the hands of the employee.
A Individual Retirement Annuity is also possible. An IRA lets you make regular, income-generating payments to yourself over your life. Contributions to IRAs will not be taxed
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)
- Instead, the economy improved, stocks rebounded, and gold plunged, losing 28 percent of its value in 2013. (aarp.org)
- This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (smartasset.com)
- If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (lendedu.com)
- Gold is considered a collectible, and profits from a sale are taxed at a maximum rate of 28 percent. (aarp.org)
External Links
bbb.org
finance.yahoo.com
cftc.gov
investopedia.com
- Do You Need a Gold IRA to Get Retirement?
- What are the Options Types, Spreads, Example, and Risk Metrics
How To
The best way online to buy gold or silver
Before you can buy gold, it is important to understand its workings. Gold is a precious metal similar to platinum. It is rare and used as money due to its durability and resistance against corrosion. It's hard to use, so most people prefer buying jewelry made out of it to actual bars of gold.
There are two types currently available: legal tender and bullion. Legal tender coins can be used for circulation within a country. These coins usually come in denominations such $1, $5 and $10.
Bullion coins should only be used for investment purposes. Inflation can cause their value to increase.
They can't be exchanged in currency exchange systems. A person can buy 100 grams of gold for $100. Each dollar spent by the buyer is worth 1 gram.
You should also know where to buy your gold. There are many options for buying gold directly from dealers. First, you can visit your local coin store. Another option is to go through a reputable site like eBay. You may also be interested in buying gold through private sellers online.
Individuals who sell gold at wholesale and retail prices are called private sellers. Private sellers typically charge 10% to 15% commission on each transaction. This means that you will get less back from a private seller than if you sell it through a coin shop or on eBay. This option is often a great one for investors in gold, as it gives you greater control over the item's value.
The other option is to purchase physical gold. Physical gold is much easier to store than paper certificates, but you still have to worry about storing it safely. It is important to keep your physical gold safe in an impenetrable box such as a vault, safety deposit box or other secure container.
When buying gold on your own, you can visit a bank or a pawnshop. A bank will be able to provide you with a loan for the amount of money you want to invest in gold. Small establishments that allow customers to borrow money for items they have brought are called pawnshops. Banks typically charge higher interest rates than pawn shops.
Another way to purchase gold is to ask another person to do it. Selling gold can also be done easily. You can contact a company like GoldMoney.com to set up an account and receive payments right away.
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By: Terence Zimwara
Title: Hong Kong Regulator Urges Crypto Investors to Use Approved Virtual Asset Trading Platforms
Sourced From: news.bitcoin.com/hong-kong-securities-regulator-issues-warning-to-unlicensed-virtual-asset-trading-platforms/
Published Date: Tue, 06 Feb 2024 11:30:34 +0000
