Introduction
Matrixport's research team has observed a significant increase in U.S. money market fund deposits, doubling since the outbreak of Covid-19. This growth, they believe, bodes well for the continued expansion of the crypto asset market. Analysts anticipate that bitcoin will maintain its upward trajectory, regardless of whether a spot exchange-traded fund (ETF) is approved, citing multiple factors driving its sustained demand.
Envisioning Crypto Gains Without Spot Bitcoin ETF Approval
In a mid-October analysis, Matrixport's crypto financial services experts projected that bitcoin's value could range between $42,000 and $56,000 per unit, should the U.S. Securities and Exchange Commission endorse a spot bitcoin ETF. However, a more recent report, led by Matrixport's Head of Research Markus Thielen, suggests that bitcoin (BTC), along with the broader crypto market, is poised for growth even without ETF approval.
The report states, "Even if the SEC still disapproves of bitcoin spot ETFs in January 2024, we will likely see higher crypto prices in 2024. Crypto investors should monitor the bitcoin dominance chart daily as a declining indicator could signal that an altcoin rally is imminent."
Growth in U.S. Money Market Funds
Matrixport's analysts highlight the substantial growth in U.S. money market funds, which soared from $3 trillion to $6.1 trillion since Covid-19 began. This surge results in an extra $320 billion in annual interest payments, summing up to $370 billion each year, or roughly $1 billion daily. The research team believes such financial movements create an encouraging landscape for investments in volatile assets like stocks and crypto assets.
The Pivotal Year of 2024
The year 2024 is also underscored as pivotal in the crypto domain. "Not only is 2024 a Bitcoin halving year in which bitcoin prices have risen — on average — by +192%, but 2024 is also an election year, and the likelihood that former President Donald Trump will be elected again is high," note the researchers, echoing predictions similar to those of Vaneck. The report suggests Trump's potential policies could spur growth in the U.S. economy, thereby uplifting U.S. stocks and crypto tokens.
Bitcoin's Performance and Federal Reserve Discussions
One of Matrixport's earlier predictions has already materialized, with BTC surpassing the $42K mark. As of the latest data, the leading cryptocurrency is trading at $42,834 per unit as of 2:40 p.m. (EST) on Thursday. The report also touches upon discussions among Federal Reserve members, including Fed Chair Jerome Powell, about potential rate cuts. In a report published in July, the researchers predicted that BTC could skyrocket to $125,000 per coin by the end of 2024.
Your Thoughts
What do you think about the researcher's report that suggests the crypto economy will continue to flourish even without a spot bitcoin ETF approval? Share your thoughts and opinions about this subject in the comments section below.
Frequently Asked Questions
Who is the owner of the gold in a gold IRA
The IRS considers an individual who owns gold as holding “a form of money” subject to taxation.
To take advantage of this tax-free status, you must own at least $10,000 worth of gold and have been storing it for at least five years.
Gold can be used to protect against inflation and price volatility. However, it is not a good idea to own gold if you don't intend to use it.
If you plan on selling the gold someday, you'll need to report its value, which could affect how much capital gains taxes you owe when you cash in your investments.
To find out what options you have, consult an accountant or financial planner.
Is gold buying a good retirement option?
Although buying gold as an investment might not sound appealing at first, when you look at the average annual gold consumption worldwide, it is worth looking into.
The best form of investing is physical bullion, which is the most widely used. But there are many other options for investing in gold. You should research all options thoroughly before making a decision on which option you prefer.
If you're not looking to secure your wealth, it may be worth considering purchasing shares in mining equipment or companies that extract gold. If you need cash flow to finance your investment, then gold stocks could be a good option.
You also can put your money into exchange-traded funds (ETFs), which essentially give you exposure to the price of gold by holding gold-related securities instead of actual gold. These ETFs typically include stocks from gold miners, precious metallics refiners, commodity trading companies, and other commodities.
What proportion of your portfolio should you have in precious metals
To answer this question we need to first define precious metals. Precious metals are those elements that have an extremely high value relative to other commodities. This makes them valuable in investment and trading. Gold is currently the most widely traded precious metal.
There are however many other types, including silver, and platinum. While gold's price fluctuates during economic turmoil, it tends to remain relatively stable. It also remains relatively unaffected by inflation and deflation.
In general, all precious metals have a tendency to go up with the market. But they don't always move in tandem with one another. If the economy is struggling, the gold price tends to rise, while the prices for other precious metals tends to fall. Investors are more likely to expect lower interest rates making bonds less attractive investments.
When the economy is healthy, however, the opposite effect occurs. Investors prefer safe assets such as Treasury Bonds and demand fewer precious metals. Since these are scarce, they become more expensive and decrease in value.
It is important to diversify your portfolio across precious metals in order to maximize your profit from precious metals investments. Furthermore, because the price of precious Metals fluctuates, it is best not to focus on just one type of precious Metals.
Do you need 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. If you lose money in your investment, nothing can be done to recover it. This includes investments that have been damaged by fire, flooding, theft, and so on.
Protect yourself against this type of loss by investing in physical gold or silver coins. These items are timeless and have a lifetime value. These items are worth more today than they were when first produced.
When opening an IRA account, make sure you choose a reputable company offering competitive rates and high-quality products. It is also a smart idea to use a third-party trustee who will help you have access to your assets at all times.
You won't get any returns until you retire if you open an account. So, don't forget about the future!
What are the pros and cons of a gold IRA?
An Individual Retirement Account is a more beneficial option than regular savings accounts. You don't pay taxes on any interest earned. An IRA is a great way to save money and not have to pay taxes on the interest you earn. This type of investment has its downsides.
If you withdraw too many funds from your IRA at once, you may lose all your accumulated assets. The IRS may prohibit you from withdrawing funds from your IRA before you are 59 1/2 years of age. You will likely have to pay a penalty fee if you withdraw funds from an IRA.
You will also need to pay fees for managing your IRA. Many banks charge between 0.5%-2.0% per year. Other providers may charge monthly management fees, ranging between $10 and $50.
If you prefer to keep your money outside a bank, you'll need to purchase insurance. Insurance companies will usually require that you have at least $500,000. Some insurers may require you to have insurance that covers losses up $500,000.
If you choose to go with a gold IRA, you'll need to determine how much gold you want to use. Some providers restrict the amount you can own in gold. Others allow you the freedom to choose your own weight.
Also, you will need to decide if you want to buy physical gold futures contracts or physical gold. Physical gold is more expensive than gold futures contracts. Futures contracts offer flexibility for buying gold. You can set up futures contracts with a fixed expiration date.
Also, you will need to decide on the type of insurance coverage you would like. The standard policy does NOT include theft protection and loss due to fire or flood. It does offer coverage for natural disasters. If you live in a high-risk area, you may want to add additional coverage.
Apart from insurance, you should consider the costs of storing your precious metals. Insurance won't cover storage costs. Additionally, safekeeping is usually charged by banks at around $25-$40 per monthly.
Before you can open a gold IRA you need to contact a qualified Custodian. A custodian helps you keep track of your investments, and ensures compliance with federal regulations. Custodians cannot sell your assets. They must instead keep them for as long as you ask.
Once you've decided which type of IRA best suits your needs, you'll need to fill out paperwork specifying your goals. The plan should contain information about the types of investments you wish to make such as stocks, bonds or mutual funds. Also, you should specify how much each month you plan to invest.
After filling in the forms, please send them to the provider. After reviewing your application, the company will send you a confirmation mail.
When opening a gold IRA, you should consider using a financial planner. A financial planner is an expert in investing and can help you choose the right type of IRA for you. They can help reduce your expenses by helping you find cheaper alternatives to buying insurance.
What are the advantages of a gold IRA
The best way to save money for retirement is to place it in an Individual Retirement Account. It will be tax-deferred up until the time you withdraw it. You are in complete control of how much you take out each fiscal year. There are many types of IRAs. Some are better suited to college savings. Some are for investors who seek higher returns. Roth IRAs, for example, allow people to contribute after they turn 59 1/2. They also pay taxes on any earnings when they retire. Once they start withdrawing money, however, the earnings aren’t subject to tax again. So if you're planning to retire early, this type of account may make sense.
An IRA with a gold status is like any other IRA because you can put money into different asset classes. Unlike a regular IRA, you don't have to worry about paying taxes on your gains while you wait to access them. For people who would rather invest than spend their money, gold IRA accounts are a good option.
An additional benefit to owning gold through an IRA, is the ease of automatic withdrawals. That means you won't have to think about making deposits every month. Direct debits could be set up to ensure you don't miss a single payment.
Finally, gold is one the most secure investment options available. Because it isn’t tied to any specific country, gold’s value tends to stay stable. Even in times of economic turmoil, gold prices tend not to fluctuate. This makes it a great investment option to protect your savings from inflation.
Statistics
- You can only purchase gold bars at least 99.5% purity. (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)
- Instead, the economy improved, stocks rebounded, and gold plunged, losing 28 percent of its value in 2013. (aarp.org)
- 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)
- This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (smartasset.com)
External Links
irs.gov
law.cornell.edu
- 7 U.S. Code SS7 – Designation board of trade as contract marketplaces
- 26 U.S. Code SS 408 – Individual retirement account
cftc.gov
wsj.com
- Saddam Hussein's InvasionHelped Uncage a Bear In 1991 – WSJ
- How do you keep your IRA Gold at Home? It's not exactly legal – WSJ
How To
How to Hold Physical Gold in an IRA
The most obvious way to invest in gold is by buying shares from companies producing gold. However, there are risks associated with this strategy. It isn't always possible for these companies to survive. If they survive, there's still the risk of losing money due to fluctuations in the price of gold.
The alternative is to buy physical gold. This means that you will need to open an account at a bank, bullion seller online, or purchase gold from a trusted seller. This option has many advantages, including the ease of access (you don’t have to deal with stock markets) and the ability of making purchases at low prices. It's also easier to see how much gold you've got stored. You'll get a receipt showing exactly what you paid, so you'll know if any taxes were missed. You are also less likely to be robbed than investing in stocks.
However, there can be some downsides. You won't be able to benefit from investment funds or interest rates offered by banks. You won't have the ability to diversify your holdings; you will be stuck with what you purchased. Finally, the taxman may ask you about where you have put your gold.
BullionVault.com has more information about how to buy gold in an IRA.
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By: Jamie Redman
Title: Matrixport Report: Crypto Market Poised for Growth Despite ETF Approval
Sourced From: news.bitcoin.com/analysts-predict-higher-crypto-prices-in-2024-regardless-of-spot-bitcoin-etf-approval/
Published Date: Thu, 14 Dec 2023 21:00:09 +0000
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