Gary Gensler's Advice to Crypto Investors
U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler recently issued a statement urging caution for investors considering crypto investments. This comes in light of the SEC's upcoming decision on the approval of spot bitcoin exchange-traded funds (ETFs). Gensler emphasized the potential risks associated with crypto assets and advised investors to approach them with caution.
In a social media post, Gensler shared an article by Lori Schock, the Director of the SEC's Office of Investor Education and Advocacy, titled "Thinking About Buying the Latest New Cryptocurrency or Token?". The article highlights the risks involved in crypto investing and provides advice on how investors should proceed. One key piece of advice is to avoid falling for high-pressure sales tactics, guaranteed returns, or too-good-to-be-true claims. Gensler emphasized the importance of conducting thorough research, evaluating financial goals, and making informed investment decisions.
A Prelude to Imminent Spot Bitcoin ETF Approval?
Gensler's repeated statements on crypto investing this week have led to speculation that the SEC is preparing to approve spot bitcoin ETFs. The decision is expected to be announced on Wednesday, which is the deadline for the joint proposal submitted by Cathie Wood's Ark Invest and 21shares.
According to Fox Business reporter Charles Gasparino, securities lawyers who work closely with the SEC believe that Gensler's recent warnings are a signal of the imminent approval of spot bitcoin ETFs. One lawyer explained that there are no longer any regulatory obstacles to approval, as the risks associated with crypto assets are now well-known and the trading processes are deemed adequate. However, the lawyer also cautioned that the risks in the crypto market remain high, especially for processes outside the United States that are difficult to regulate.
It is worth noting that there was a momentary confusion when the official SEC account on social media announced the approval of spot bitcoin ETFs. However, Gensler quickly clarified that the post was unauthorized and that the agency's social media account had been compromised.
In conclusion, Gary Gensler's recent statements regarding crypto investments, coupled with the upcoming spot bitcoin ETF decision, have drawn attention to the potential future of crypto assets in the financial market. Investors are advised to exercise caution and stay informed about the risks associated with these investments.
What are your thoughts on Gensler's repeated statements about crypto investments ahead of the spot bitcoin ETF decision? Share your opinions in the comments section below.
Frequently Asked Questions
What are the benefits of a gold IRA
Many benefits come with a gold IRA. It is an investment vehicle that can diversify your portfolio. 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. This allows you to easily transition if your retirement is early.
The best part is that you don’t need special skills to invest in gold IRAs. These IRAs are available at all banks and brokerage houses. Withdrawals can happen automatically, without any fees or penalties.
That said, there are drawbacks too. Gold is historically volatile. It is important to understand why you are investing in gold. Are you seeking safety or growth? Is it for insurance purposes or a long-term strategy? Only once you know, that will you be able to make an informed decision.
You might want to buy more gold if you intend to keep your gold IRA for a long time. One ounce won’t be enough to meet all your needs. Depending upon what you plan to do, you could need several ounces.
You don’t necessarily need a lot if you’re looking to sell your gold. You can even live with just one ounce. These funds won’t allow you to purchase anything else.
Do you need 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. There is no way to recover money that you have invested in precious metals. This includes losing all your investments due to theft, fire, flood, etc.
You can protect yourself against such losses by purchasing physical gold and silver coins. These items have been around thousands of years and are irreplaceable. If you were to sell them today, you would likely receive more than what you paid for them when they were first minted.
If you decide to open an IRA account, choose a reputable company that offers competitive rates and products. You should also consider using a third party custodian to protect your assets and give you access at any time.
Do not open an account unless you’re ready to retire. Do not forget about the future!
How much should precious metals make up your portfolio?
First, let’s define precious metals to answer the question. Precious elements are those elements which have a high price relative to other commodities. This makes them extremely valuable for trading and investing. The most traded precious metal is gold.
There are also many other precious metals such as platinum and silver. The price of gold tends to fluctuate but generally stays at a reasonably stable level during periods of economic turmoil. It is also unaffected significantly by inflation and Deflation.
In general, prices for precious metals tend increase with the overall marketplace. That said, they do not always move in lockstep with each other. If the economy is struggling, the gold price tends to rise, while the prices for other precious metals tends to fall. This is because investors expect lower rates of interest, which makes bonds less attractive investments.
The opposite effect happens when the economy is strong. Investors are more inclined to invest in safe assets, such as Treasury Bonds, and they will not demand precious metals. Since these are scarce, they become more expensive and decrease in value.
Therefore, to maximize profits from investing in precious metals, you must diversify across multiple precious metals. You should also diversify because precious metal prices can fluctuate and it is better to invest in multiple types of precious metals than in one.
Are You Ready to Invest in Gold?
It depends on how much you have saved and if gold was available at the time you started saving. If you are unsure which option to choose, consider investing in both options.
Gold offers potential returns and is therefore a safe investment. This makes it a worthwhile choice for retirees.
While many investments promise fixed returns, gold is subject to fluctuations. This causes its value to fluctuate over time.
However, this does not mean that gold should be avoided. Instead, it just means you should factor the fluctuations into your overall portfolio.
Another benefit of gold is that it’s a tangible asset. Gold is less difficult to store than stocks or bonds. It can be easily transported.
As long as you keep your gold in a secure location, you can always access it. Plus, there are no storage fees associated with holding physical gold.
Investing in gold can help protect against inflation. Gold prices are likely to rise with other commodities so it is a good way of protecting against rising costs.
A portion of your savings can be invested in something that doesn’t go down in value. Gold usually rises when stocks fall.
Another benefit to investing in gold? You can always sell it. You can also liquidate your gold position at any time you need cash, just like stocks. It doesn’t matter if you are retiring.
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. Next, add more as required.
The goal is not to become rich quick. Instead, the goal is to accumulate enough wealth that you don’t have to rely on Social Security.
Although gold might not be the right investment for everyone it could make a great addition in any retirement plan.
How Does Gold Perform as an Investment?
The supply and demand for gold affect the price of gold. It is also affected negatively by interest rates.
Because of their limited supply, gold prices can fluctuate. There is also a risk in owning gold, as you must store it somewhere.
Statistics
- 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)
- If you take distributions before hitting 59.5, you’ll owe a 10% penalty on the amount withdrawn. (lendedu.com)
- This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (smartasset.com)
- 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)
External Links
wsj.com
- Saddam Hussein’s InvasionHelped Uncage a Bear In 90 – WSJ
- Are you interested in keeping gold in your IRA at-home? It’s Not Exactly Legal – WSJ
bbb.org
irs.gov
finance.yahoo.com
How To
Three Ways to Invest In Gold For Retirement
It’s important to understand how gold fits in with your retirement plan. You have many options for investing in gold if there is a 401K account at your workplace. You may also want to consider investing in gold outside of your workplace. For example, if you own an IRA (Individual Retirement Account), you could open a custodial account at a brokerage firm such as Fidelity Investments. If you don’t have any precious metals yet, you might want to buy them from a reputable dealer.
These are the three rules to follow if you decide to invest in gold.
- Buy Gold with Cash – Avoid using credit cards or borrowing money to fund investments. Instead, instead, transfer cash to your accounts. This will help to keep your purchasing power high and protect you against inflation.
- Own Physical Gold Coins – You should buy physical gold coins rather than just owning a paper certificate. It’s easier to sell physical gold coins rather than certificates. You don’t have to store physical gold coins.
- Diversify Your Portfolio. Never place all your eggs in the same basket. Also, diversify your wealth and invest in different assets. This can reduce market volatility and help you be more flexible.
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By: Kevin Helms
Title: SEC Chair Gary Gensler Advises Caution in Crypto Investments: Potential Prelude to Spot Bitcoin ETF Approval
Sourced From: news.bitcoin.com/sec-chair-gary-gensler-issues-crypto-investing-advice-lawyers-see-as-prelude-to-spot-bitcoin-etf-approval/
Published Date: Wed, 10 Jan 2024 02:00:55 +0000
