The Rejection of U.S. Treasury's Policy Suggestions
Warren Davidson, Vice Chairman of the Subcommittee on Digital Assets, Financial Technology, and Inclusion of the House Financial Services Committee, has rejected the policies presented by the U.S. Treasury to regulate crypto assets. In a recent opinion post titled "Setting the record straight and debunking unworkable illicit finance proposals," Davidson explains that these suggestions, very similar to the proposals presented by Sen. Elizabeth Warren, seek to disarm the cryptocurrency industry in the U.S.
The Classification of Crypto Financial Institutions
The suggested policies would classify wallet providers, miners, validators, and other network participants as a new group of crypto financial institutions, subject to the same reporting standards that traditional finance institutions do.
Ignorance and National Security Concerns
Davidson explains that Sen. Warren's allegations indicating even validator node operators "pose national security concerns" show a degree of ignorance "unbecoming of any policymaker."
The Objective of the Measures
"It's an attempt to capitalize on others' ignorance by pursuing a backdoor pathway to effectively ban digital assets in the United States through a crushing and entirely unworkable compliance burden," stated Davidson.
Misconceptions about Terrorism Financing
Furthermore, Davidson stresses that blockchain and cryptocurrency are not the preferred methods for terrorism financing, given that recent media reports incorrectly pointed out that the terrorist group Hamas had raised over $93 million in digital assets. He claims this notion has been used to push this kind of policy that seeks to dismantle the future of the crypto industry in the U.S.
The Impact on the Crypto Industry
Davidson argued that the first measure to combat illicit movements in crypto should be to bring more crypto companies to the U.S., a goal that will be difficult to fulfill if these policies get approved. "Their purposefully unworkable framework will drive companies and capital offshore," he concluded.
What do you think about Warren Davidson's take on crypto policing? Tell us in the comments section below.
Frequently Asked Questions
Can I keep a Gold ETF in a Roth IRA
While a 401k may not offer this option for you, it is worth considering other options, such an Individual Retirement Plan (IRA).
A traditional IRA allows for contributions from both employer and employee. A Employee Stock Ownership Plan, or ESOP, is another way to invest publicly traded companies.
An ESOP gives employees tax advantages as they share the stock of the company and the profits it makes. The tax rate on money that is invested in an ESOP is lower than if it was held in the employees' hands.
A Individual Retirement Annuity is also possible. With an IRA, you make regular payments to yourself throughout your lifetime and receive income during retirement. Contributions to IRAs can be made without tax.
Can I hold physical gold in my IRA?
Gold is money. Not just paper currency. People have used gold as a currency for thousands of centuries to preserve their wealth and keep it safe from inflation. Investors use gold today as part of their diversified portfolio, because it tends to perform better in times of financial turmoil.
Many Americans now invest in precious metals. It is possible to make money by investing in gold. However, it doesn't guarantee that you'll make a lot of money.
One reason is that gold has historically performed better than other assets during periods of financial panic. Between August 2011 to early 2013, gold prices rose close to 100 percent while the S&P 500 fell 21 per cent. During those turbulent market conditions, gold was among the few assets that outperformed stocks.
Gold is one of the few assets that has virtually no counterparty risks. You still have your shares even if your stock portfolio falls. But if you own gold, its value will increase even if the company you invested in defaults on its debt.
Finally, gold provides liquidity. This means you can easily sell your gold any time, unlike other investments. You can buy gold in small amounts because it is so liquid. This allows you take advantage of the short-term fluctuations that occur in the gold markets.
Should you Invest In Gold For Retirement?
How much money you have saved, and whether or not gold was an option when you first started saving will determine the answer. If you're unsure about which option to choose then consider investing in both.
In addition to being a safe investment, gold also offers potential returns. It's a great investment for retirees.
Most investments have fixed returns, but gold's volatility is what makes it unique. This causes its value to fluctuate over time.
However, this does not mean that gold should be avoided. It is important to consider the fluctuations when planning your portfolio.
Another benefit to gold? It's a tangible asset. Gold is less difficult to store than stocks or bonds. It can be easily transported.
Your gold will always be accessible as long you keep it in a safe place. You don't have to pay storage fees for physical gold.
Investing in gold can help protect against inflation. You can hedge against rising costs by investing in gold, which tends to rise alongside other commodities.
A portion of your savings can be invested in something that doesn't go down in value. Gold usually rises when stocks fall.
You can also sell gold anytime you like by investing in 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. Don't place all your eggs in the same basket.
Don't purchase too much at once. Begin by buying a few grams. You can add more as you need.
Don't expect to be rich overnight. It is to create enough wealth that you no longer have to depend on Social Security.
Even though gold is not the best investment, it could be an excellent addition to any retirement plan.
How is gold taxed by Roth IRA?
An investment account's tax is calculated based on the current value of the account, and not on what you paid originally. If you invest $1,000 into a mutual fund, stock, or other investment account, then any gains are subjected tax.
You don't pay tax if you have the money in a traditional IRA/401k. You pay taxes only on earnings from dividends and capital gains — which apply only to investments held longer than one year.
These accounts are subject to different rules depending on where you live. For example, in Maryland, you must take withdrawals within 60 days after reaching age 59 1/2 . In Massachusetts, you can wait until April 1st. New York is open until 70 1/2. To avoid penalties, you should plan ahead and take distributions as soon as possible.
What are the advantages of a IRA with a gold component?
There are many advantages to a gold IRA. You can diversify your portfolio with this investment vehicle. You control how much money goes into each account and when it's 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 part? You don’t need to have any special skills to invest into gold IRAs. They're readily available at almost all banks and brokerage firms. You don't have to worry about penalties or fees when withdrawing money.
However, there are still some drawbacks. Gold is historically volatile. So it's essential to understand why you're investing in gold. Are you looking for safety or growth? Is it for insurance purposes or a long-term strategy? Only when you are clear about the facts will you be able take an informed decision.
If you plan to keep your gold IRA indefinitely, you'll probably want to consider buying more than one ounce of gold. One ounce doesn't suffice to cover all your needs. Depending upon what you plan to do, you could need several ounces.
A small amount is sufficient if you plan to sell your gold. You can even get by with less than one ounce. You won't be capable of buying anything else with these funds.
Which precious metal is best to invest in?
The answer to this question depends on how much risk you are willing to take and what type of return you want. 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.
Gold is the best investment if you aren't looking to get rich quick. However, silver might be a better option if you're looking for an investment that provides steady returns over long periods.
Statistics
- 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)
- (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)
- Gold is considered a collectible, and profits from a sale are taxed at a maximum rate of 28 percent. (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)
External Links
irs.gov
finance.yahoo.com
investopedia.com
cftc.gov
How To
The best way to buy gold (or silver) online
To buy gold, you must first understand how it works. Precious metals like gold are similar to platinum. It's very rare and is used as money because of its durability and resistance to corrosion. It is hard to use, so most people prefer jewelry made of it to real bars of gold.
There are two types of gold coins available today – one type is legal tender, while the other is called 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 are not exchangeable in any currency exchange system. If a person purchases $100 worth of gold, 100 grams of the gold will be given to him/her. The $100 value is $100. For every dollar spent, the buyer gets 1 gram of Gold.
The next thing you should know when looking to buy gold is where to do it from. You have a few options to choose from if you are looking to buy gold directly through a dealer. First off, you can go through your local coin shop. You might also consider going through a reputable online seller like eBay. Finally, you can look into purchasing gold through private sellers online.
Private sellers are individuals who offer gold for sale, either at wholesale prices or retail prices. You pay a commission fee between 10% and 15% for each transaction when you sell gold through private sellers. 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 is a great option for gold investing because you have more control over the item’s price.
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.
To purchase gold by yourself, you can visit a bank and a pawnshop. A bank can provide you with a loan to cover the amount you wish to invest in gold. These are small businesses that let customers borrow money against the items they bring to them. Banks usually charge higher interest rates that pawn shops.
The final option is to ask someone to buy your gold! Selling gold can also be done easily. A company such as GoldMoney.com can help you set up a simple bank account and get paid immediately.
—————————————————————————————————————————————————————————————-
By: Sergio Goschenko
Title: Warren Davidson Rejects U.S. Treasury's Policy Suggestions on Crypto Assets
Sourced From: news.bitcoin.com/congressman-warren-davidson-rails-against-treasurys-red-herring-arguments-on-crypto/
Published Date: Fri, 12 Jan 2024 06:30:25 +0000
