SEC Chair Gary Gensler Sees Irony in Spot Bitcoin ETF Approval — ‘This Was About Centralization’

Spot Bitcoin ETF Approval and Centralization

The approval of spot bitcoin exchange-traded funds (ETFs) by the U.S. Securities and Exchange Commission (SEC) has raised concerns for SEC Chair Gary Gensler. In an interview with CNBC, Gensler highlighted the irony of the situation, stating that the approval of these ETFs has led to centralization, contradicting the decentralized nature that bitcoin's creator, Satoshi Nakamoto, intended.

Gensler emphasized that investors should be cautious when dealing with bitcoin, as it is a highly speculative and volatile asset. He further pointed out that bitcoin has been associated with illicit activities such as money laundering, sanctions evasion, and ransomware attacks.

Centralization and Traditional Means of Finance

Gensler expressed his skepticism towards the notion that the approval of spot bitcoin ETFs is a historic moment. Instead, he highlighted that it signifies a shift towards centralization and traditional means of finance. He noted that investors could already invest in bitcoin through major brokerage houses, and the introduction of spot bitcoin ETFs adds another centralized option for investment.

The SEC chairman acknowledged that the approval of these ETFs does not imply an endorsement of bitcoin itself. He clarified that the approval is for an exchange-traded product that allows investors to invest in the underlying commodity, bitcoin. However, he issued a warning to investors about the speculative and volatile nature of bitcoin, as well as its association with illegal activities.

The Future of Bitcoin and Investor Awareness

Gensler questioned the practicality of using bitcoin as a payment method, stating that it is primarily being used for illicit activities. He urged investors to be aware of the risks involved when investing in bitcoin and to understand its limited use cases beyond speculation and illicit transactions.

As the Chairman of the SEC, Gensler's statements reflect his concerns about the potential risks and implications of spot bitcoin ETFs. While the approval of these ETFs may provide investors with additional investment options, it also raises questions about the growing centralization of the cryptocurrency market.

What are your thoughts on SEC Chairman Gary Gensler's statements? Let us know in the comments section below.

Frequently Asked Questions

What is a gold IRA account?

The Gold Ira Accounts are tax-free investment options for those who want to make investments in precious metals.

You can purchase physical gold bullion coins anytime. You don't have a retirement date to invest in gold.

Owning gold as an IRA has the advantage of allowing you to keep it forever. Your gold assets will not be subjected tax upon your death.

Your gold will be passed on to your heirs, without you having to pay capital gains taxes. It is not required that you include your gold in the final estate report because it remains outside your estate.

You'll first have to set up an individual retirement account (IRA) to open a gold IRA. Once you've done that, you'll receive an IRA custody. This company acts in the role of a middleman between your IRS agent and you.

Your gold IRA custodian can handle all paperwork and submit necessary forms to IRS. This includes filing annual reports.

Once you've established your gold IRA, you'll be able to purchase gold bullion coins. The minimum deposit required for gold bullion coins purchase is $1,000 However, you'll receive a higher interest rate if you put in more.

When you withdraw your gold from your IRA, you'll pay taxes on it. If you're withdrawing the entire balance, you'll owe income taxes plus a 10 percent penalty.

You may not be required to pay taxes if you take out only a small amount. There are some exceptions, though. There are some exceptions. For instance, if you take out 30% or more from your total IRA assets, federal income taxes will apply plus a 20 percent penalty.

You should avoid taking out more than 50% of your total IRA assets yearly. Otherwise, you'll face steep financial consequences.

How Much of Your IRA Should Include Precious Metals?

The most important thing you should know when investing in precious metals is that they are not just for wealthy people. You don't need to be rich to make an investment in precious metals. There are many ways to make money on silver and gold investments without spending too much.

You might consider purchasing physical coins, such as bullion bars and rounds. Stocks in companies that produce precious materials could be purchased. Another option is to make use of the IRA rollover programs offered by your retirement plan provider.

You will still reap the benefits of owning precious metals, regardless of which option you choose. They offer the potential for long-term, sustainable growth even though they aren’t stocks.

Their prices are more volatile than traditional investments. If you decide to sell your investment, you will likely make more than with traditional investments.

What is a Precious Metal IRA, and how can you get one?

You can diversify your retirement savings by investing in precious metal IRAs. This allows you to invest in gold, silver and platinum as well as iridium, osmium and other rare metals. These precious metals are extremely rare and valuable. These metals are great investments and can help protect your financial future from economic instability and inflation.

Bullion is often used to refer to precious metals. Bullion refers only to the actual metal.

Bullion can be bought via various channels, such as online retailers, large coin dealers and grocery stores.

A precious metal IRA allows you to invest directly in bullion, rather than buying stock shares. This allows you to receive dividends every year.

Precious metal IRAs are not like regular IRAs. They don't need paperwork and don't have to be renewed annually. Instead, your gains are subject to a small tax. You also have unlimited access to your funds whenever and wherever you wish.

How do I open a Precious Metal IRA

First, you must decide if your Individual Retirement Account (IRA) is what you want. You must complete Form 8606 to open an account. For you to determine the type and eligibility for which IRA, you need Form 5204. This form should be completed within 60 days after opening the account. Once this is done, you can start investing. You may also choose to contribute directly from your paycheck using payroll deduction.

To get a Roth IRA, complete Form 8903. Otherwise, the process will look identical to an existing IRA.

You'll need to meet specific requirements to qualify for a precious metals IRA. The IRS stipulates that you must have earned income and be at least 18-years old. Your earnings cannot exceed $110,000 per year ($220,000 if married and filing jointly) for any single tax year. Contributions must be made regularly. These rules apply whether you're contributing through an employer or directly from your paychecks.

A precious metals IRA can be used to invest in palladium or platinum, gold, silver, palladium or rhodium. But, you'll only be able to purchase physical bullion. You won't have the ability to trade stocks or bonds.

You can also use your precious metallics IRA to invest in companies that deal with precious metals. This option may be offered by some IRA providers.

An IRA is a great way to invest in precious metals. However, there are two important drawbacks. First, they don't have the same liquidity as stocks or bonds. This makes them harder to sell when needed. They don't yield dividends like bonds and stocks. Therefore, you will lose more money than you gain over time.

What are the pros & cons of a Gold IRA?

An Individual Retirement Plan (IRA) has a major advantage over regular savings accounts. It doesn't tax any interest earned. An IRA is a good choice for those who want a way to save some money but don’t want the tax. However, there are disadvantages to this type investment.

If you withdraw too many funds from your IRA at once, you may lose all your accumulated assets. Also, the IRS may not allow you to make withdrawals from your IRA until you're 59 1/2 years old. A penalty fee will be charged if you decide to withdraw funds.

Another problem is the cost of managing your IRA. Many banks charge between 0.5% and 2.0% per year. Other providers charge monthly management charges ranging anywhere from $10 to $50.

Insurance is necessary if you wish to keep your money safe from the banks. Many insurers require that you own at least one ounce of gold before you can make a claim. You might be required to buy insurance that covers losses up to $500,000.

If you choose to have a gold IRA you will need to establish how much gold to use. Some providers restrict the amount you can own in gold. Some providers allow you to choose your weight.

It's also important to decide whether or not to buy gold futures contracts. Physical gold is more expensive than gold futures contracts. Futures contracts offer flexibility for buying gold. They let you set up a contract that has a specific expiration.

It is also important to choose the type of insurance coverage that you need. The standard policy does not include theft protection or loss caused by fire, flood, earthquake. It does offer coverage for natural disasters. You may consider adding additional coverage if you live in an area at high risk.

In addition to insurance, you'll need to consider the cost of storing your gold. Storage costs are not covered by insurance. In addition, most banks charge around $25-$40 per month for safekeeping.

To open a IRA in gold, you will need to first speak with a qualified custodian. A custodian maintains track of all your investments and ensures you are in compliance with federal regulations. Custodians aren't allowed to sell your assets. They must instead keep them for as long as you ask.

After you have decided on the type of IRA that best suits you, you will need to complete paperwork detailing 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.

Once you have completed the forms, you will need to mail them to your provider with a check and a small deposit. After receiving your application, the company will review it and mail you a confirmation letter.

A financial planner is a good idea when opening a gold IRA. A financial planner is an expert in investing and can help you choose the right type of IRA for you. They can help you find cheaper insurance options to lower your costs.

How much gold can you keep in your portfolio

The amount of capital required will affect the amount you make. If you want to start small, then $5k-$10k would be great. As you grow, it is possible to rent desks or office space. This will allow you to pay rent monthly, and not worry about it all at once. Rent is only paid per month.

Also, you need to think about the type of business that you are going to run. In my case, I am running a website creation company, so we charge clients around $1000-2000/month depending on what they order. You should also consider the expected income from each client when you do this type of thing.

Freelance work is not likely to pay a monthly salary. The project pays freelancers. So you might only get paid once every 6 months or so.

You need to determine what kind or income you want before you decide how much of it you will need.

I recommend starting with $1k-$2k in gold and working my way up.

What precious metal should I invest in?

This depends on what risk you are willing take and what kind of return you desire. Gold has been traditionally considered a haven investment, but it's not always the most profitable choice. For example, if you need a quick profit, gold may not be for you. You should invest in silver if you have the patience and time.

If you don’t desire to become rich quickly, gold may be your best option. If you want to invest in long-term, steady returns, silver is a better choice.

Statistics

• Instead, the economy improved, stocks rebounded, and gold plunged, losing 28 percent of its value in 2013. (aarp.org)
• (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)
• 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)
• 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)

External Links

forbes.com

• Gold IRA – Add Sparkle to Your Retirement Nest Egg
  
• Understanding China's Evergrande Crisis – Forbes Advisor
  

finance.yahoo.com

• Barrick Gold Corporation (GOLD) Stock Price, News, Quote & History – Yahoo Finance
  

bbb.org

• Better Business Bureau (r)
  

irs.gov

• Internal Revenue Service
  

How To

The best way to buy gold (or silver) online

You must first understand the workings of gold before you can purchase it. The precious metal gold is similar to platinum. Because of its resistance to corrosion and durability, it is very rare. It is difficult to use so people prefer to buy jewelry made from it to gold bars.

Today, there are two types available in gold coins: one is legal tender and the other is bullion. The legal tender coins are issued for circulation in a country. They usually have denominations such as $1, $5, $10, and so on.

Bullion coins are minted for investment purposes only, and their values increase over time due to inflation.

They cannot be used in currency exchanges. For example, a person who buys $100 worth or gold gets 100 grams. This gold has a $100 price. Every dollar spent on gold purchases, the buyer receives one gram of gold.

When looking to buy precious metals, the next thing you should be aware of is where it can be purchased. There are a few options if you wish to buy gold directly from a dealer. First, go to your local coin shop. You can also go to a reputable website such as eBay. You may also be interested in buying gold through private sellers online.

Individuals selling gold at wholesale prices and retail prices are known as private sellers. Private sellers will charge you a 10% to 15% commission for every 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. Although physical gold is easier to store than paper certificates you will still need to ensure it is safe. Physical gold must be kept safe in an impassible container, such as a vault.

If you are looking to purchase gold on your own, you have two options: a bank or an pawnshop. A bank can offer you a loan for the amount that you need to buy gold. Customers can borrow money from pawnshops to purchase items. Banks typically charge higher interest rates than pawn shops.

The final option is to ask someone to buy your gold! Selling gold is simple too. Set up a simple account with GoldMoney.com and you will start receiving payments instantly.

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By: Kevin Helms
Title: SEC Chair Gary Gensler Sees Irony in Spot Bitcoin ETF Approval — ‘This Was About Centralization’
Sourced From: news.bitcoin.com/sec-chair-gary-gensler-sees-irony-in-spot-bitcoin-etf-approval-this-was-about-centralization/
Published Date: Tue, 16 Jan 2024 02:30:19 +0000