A nonprofit organization, Better Markets, has expressed dismay at the approval of spot bitcoin exchange-traded funds (ETFs) by the U.S. Securities and Exchange Commission (SEC). Better Markets argues that the SEC's decision has allowed for the mass marketing of a financial product that is worthless, volatile, and filled with fraud. The organization believes that bitcoin proponents may use this approval to assert government endorsement of cryptocurrencies.
Nonprofit Organization Condemns SEC's Approval of Bitcoin ETFs
In a press statement released on January 11, 2024, Better Markets criticized the SEC's approval of ETF applications, arguing that it goes against existing laws. The organization also refuted claims that a court ruling in favor of Grayscale, a crypto asset manager, had compelled the SEC to approve the ETFs. The court ruling in August 2023 deemed the SEC's rejection of Grayscale's spot Bitcoin ETF as arbitrary and capricious.
However, Better Markets clarified that the court ruling did not mandate the approval of ETFs. Instead, it highlighted the SEC's failure to provide sufficient explanation for its prior rejection. The organization asserted that the SEC should have rejected the ETF applications, providing detailed reasons for doing so. It also emphasized the prevalence of wash trading in the crypto industry, stating that a significant percentage of trading volume on unregulated exchanges is a result of wash trading.
Criticism of Bitcoin and Cryptocurrencies
Better Markets further criticized BTC and cryptocurrencies, labeling them as worthless financial products that primarily attract speculators, gamblers, and criminals. The organization argued that regulatory bodies have been unable to effectively oversee the crypto industry. It specifically called out Rostin Behnam, the chairman of the Commodities Futures Trading Commission (CFTC), accusing him of being biased in favor of cryptocurrencies.
Overall, Better Markets believes that the SEC's approval of ETFs will lead to the deceptive portrayal of government endorsement by bitcoin proponents. It contends that the mass marketing of fraudulent financial products to Main Street Americans poses a significant risk.
What are your thoughts on Better Markets' criticism of the SEC's approval of ETFs? Share your opinions in the comments below.
Frequently Asked Questions
What are the pros and cons of a gold IRA?
An Individual Retirement Account (IRA), unlike regular savings accounts, doesn't require you to pay tax on interest earned. An IRA is a great option for those who want to save money, but don't want tax on any interest earned. However, there are also disadvantages to this type of investment.
You may lose all your accumulated savings if you take too much out of your IRA. Also, the IRS may not allow you to make withdrawals from your IRA until you're 59 1/2 years old. If you do withdraw funds, you'll need to pay a penalty.
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.
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. It is possible that you will be required to purchase insurance that covers losses of up to $500,000.
If you decide to open a gold IRA, it is important to know how much you can use. Some providers limit the amount of gold that you are allowed to own. Others allow you the freedom to choose your own weight.
It is also up to you to decide whether you want to purchase physical gold or futures. Physical gold is more expensive than gold futures contracts. Futures contracts provide flexibility for purchasing gold. They let you set up a contract that has a specific expiration.
Also, you will need to decide on the type of insurance coverage you would like. Standard policies don't cover theft protection, loss due to fire, flood or earthquake. It does offer coverage for natural disasters. You might consider purchasing additional coverage if your area is 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. Safekeeping costs can be as high as $25-40 per month at most banks.
Before you can open a gold IRA you need to contact a qualified Custodian. Custodians keep track of your investments and ensure compliance with federal regulations. Custodians can't sell assets. They must instead keep them for as long as you ask.
Once you have chosen the right type of IRA to suit your needs, it is time to fill out paperwork defining your goals. The plan should contain information about the types of investments you wish to make such as stocks, bonds or mutual funds. You should also specify how much you want to invest each month.
After completing the forms, send them along with a check or a small deposit to your chosen provider. 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. Financial planners are experts at investing and can help you determine which type of IRA is best for you. They can also help you lower your expenses by finding cheaper alternatives to purchasing insurance.
What is the best precious metal to invest in?
This depends on what risk you are willing take and what kind of return you desire. Although gold has been considered a safe investment, it is not always the most lucrative. For example, if your goal is to make quick money, gold may not suit you. Silver is a better investment if you have patience and the time to do it.
If you don’t desire to become rich quickly, gold may be your best option. Silver might be a better investment option if steady returns are desired over a long period of time.
Is gold a good investment IRA?
For anyone who wants to save some money, gold can be a good investment. It is also an excellent way to diversify you portfolio. But gold is not all that it seems.
It has been used throughout history as currency and it is still a very popular method of payment. It's often referred to as “the world's oldest currency.”
Gold is not created by governments, but it is extracted from the earth. It's hard to find and very rare, making it extremely valuable.
The supply and demand for gold determine the price of gold. The strength of the economy means people spend more, and so, there is less demand for gold. This results in gold prices rising.
The flip side is that people tend to save money when the economy slows. This increases the production of gold, which in turn drives down its value.
This is why gold investment makes sense for both individuals and businesses. If you make an investment in gold, you can reap the economic benefits whenever the economy is growing.
You'll also earn interest on your investments, which helps you grow your wealth. Plus, you won't lose money if the value of gold drops.
Statistics
- Indeed, several financial advisers interviewed for this article suggest you invest 5 to 15 percent of your portfolio in gold, just in case. (aarp.org)
- 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)
- 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)
- (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)
External Links
law.cornell.edu
- 7 U.S. Code SS7 – Designation boards of trade as contract market authorities
- 26 U.S. Code SS 408 – Individual retirement accounts
bbb.org
investopedia.com
- Do You Need a Gold IRA to Get Retirement?
- What are the Options? Types, Spreads, Example, and Risk Metrics
forbes.com
- Gold IRA – Add Sparkle to Your Retirement Nest Egg
- Understanding China's Evergrande Crisis – Forbes Advisor
How To
Investing In Gold vs. Investing In Stocks
Gold investing as an investment vehicle can seem extremely risky these days. This is because most people believe that it is no longer economically profitable to invest gold. 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. However, investing in gold can still provide significant benefits. We'll be looking at some of these benefits below.
Gold is one of the oldest forms of currency known to man. There are records of its use going back thousands of years. It was used all around the world as a reserve of value. It's still used by countries like South Africa as a method of payment.
Consider the price per gram when you decide whether you should invest in or not. When looking into buying gold bullion, you must decide how much you are willing to spend per gram. If you don’t know the current market rate for gold bullion, you can always consult a local jeweler to get their opinion.
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.
When deciding whether to buy gold, another thing to consider is how much gold you intend on buying. If you plan to buy enough gold to cover your wedding rings then it is probably a good idea to wait before buying any more. But, if your goal is to make long-term investments in gold, this might be worth considering. Selling your gold at a higher value than what you bought can help you make money.
We hope that this article has helped you gain a better understanding and appreciation for gold as an investment option. We strongly recommend that you research all available options before making any decisions. Only after you have done this can you make an informed choice.
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By: Terence Zimwara
Title: The U.S. SEC's Approval of Bitcoin ETFs Enables Mass Marketing of Fraudulent Financial Products, Says Nonprofit Organization
Sourced From: news.bitcoin.com/bitcoin-etfs-enable-the-mass-marketing-of-a-worthless-asset-to-main-street-americans-says-better-markets/
Published Date: Fri, 12 Jan 2024 12:30:29 +0000
