Peter Schiff's Spot Bitcoin ETF Outlook
Renowned gold bug and cryptocurrency skeptic, Peter Schiff, has issued a warning about spot Bitcoin exchange-traded funds (ETFs), stating that they are now in bear markets. Schiff specifically mentioned the Proshares Bitcoin Strategy ETF, which has experienced a decline of over 50% in just two years, and went on to forecast even worse results for investors who have purchased the newly approved spot Bitcoin ETFs.
Schiff expressed his views on social media platform X, sharing his outlook for the spot Bitcoin ETF market. Despite Bitcoin's price briefly surpassing $47,000 in anticipation of the SEC's approval of spot Bitcoin ETFs, it experienced a downward trajectory following the announcement. The price dropped below $40,000 on Monday and further down to $39,000 on Tuesday. Schiff stated:
"All the spot Bitcoin ETFs are now in bear markets, defined as a drop of 20% or more from the peak."
He then highlighted the Proshares Bitcoin Strategy ETF, which tracks Bitcoin futures and was launched in October 2021. The ETF started trading at $40.88 and is currently trading at $19.04, marking a decline of over 50% since its inception. Schiff believes that investors who have purchased any of the 11 spot Bitcoin ETFs will face even worse outcomes.
Schiff further emphasized that the new Bitcoin ETFs are not generating additional demand but rather shifting existing demand. Instead of buying actual Bitcoin or Bitcoin-related equities such as Microstrategy stock (MSTR) or Grayscale's Bitcoin Trust (GBTC), investors are now buying the newly introduced ETFs. However, Schiff argues that rearranging the deck chairs will not prevent the ship from sinking.
The impact of spot Bitcoin ETFs extends beyond individual investors, as Schiff pointed out the negative effects on Coinbase stock (COIN). Despite Coinbase custodizing Bitcoin held in these ETFs, speculators who previously traded Bitcoin through Coinbase are now trading the ETFs instead. Additionally, many who bought COIN as a proxy for Bitcoin are now purchasing the ETFs. JPMorgan also downgraded Coinbase stock from Neutral to Underweight, setting a price target of $80.
Earlier this month, Schiff warned that spot Bitcoin ETFs would trigger a selloff by speculators and result in minimal institutional demand. He also anticipates that Gary Gensler, the chairman of the SEC, will introduce cumbersome crypto regulations that could further impact Bitcoin's price.
In conclusion, Peter Schiff's warning about spot Bitcoin ETFs highlights the current bearish trend and his concerns about the negative impact on investors. It remains to be seen how the spot Bitcoin ETF market will evolve and whether Schiff's predictions will hold true.
What are your thoughts on Peter Schiff's warning about spot Bitcoin ETFs? Share your opinion in the comments section below.
Frequently Asked Questions
How much money should I put into my Roth IRA?
Roth IRAs let you save tax on retirement by allowing you to deposit your own money. The account cannot be withdrawn from until you are 59 1/2. However, if you do decide to take out some of your contributions before then, there are specific rules you must follow. First, your principal (the original deposit amount) cannot be touched. You cannot withdraw more than the original amount you contributed. If you wish to withdraw more than you originally contributed, you will have to pay taxes.
The second rule is that your earnings cannot be withheld without income tax. You will pay income taxes when you withdraw your earnings. Consider, for instance, that you contribute $5,000 per year to your Roth IRA. Let's also say that you earn $10,000 per annum after contributing. The federal income tax on your earnings would amount to $3,500. You would have $6,500 less. You can only take out what you originally contributed.
So, if you were to take out $4,000 of your earnings, you'd still owe taxes on the remaining $1,500. On top of that, you'd lose half of the earnings you had taken out because they would be taxed again at 50% (half of 40%). So even though you received $7,000 in Roth IRA contributions, you only received $4,000.
There are two types of Roth IRAs: Traditional and Roth. A traditional IRA allows you to deduct pre-tax contributions from your taxable income. When you retire, you can use your traditional IRA to withdraw your contribution balance plus interest. You can withdraw as much as you want from a traditional IRA.
Roth IRAs are not allowed to allow you deductions for contributions. After you have retired, the full amount of your contributions and accrued interest can be withdrawn. Unlike a traditional IRA, there is no minimum withdrawal requirement. You don't need to wait until your 70 1/2 year old age before you can withdraw your contribution.
Is physical gold allowed in an IRA.
Not only is gold paper currency, but it's also money. People have used gold as a currency for thousands of centuries to preserve their wealth and keep it safe from inflation. Today, investors invest in gold as part a diversified portfolio. This is because gold tends do better in financial turmoil.
Today, many Americans invest in precious metals such as gold and silver rather than stocks and bonds. 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. The S&P 500 declined 21 percent during the same period. Gold prices increased nearly 100 per cent between August 2011 – early 2013. During turbulent market conditions gold was one of few assets that outperformed stock prices.
Another advantage of investing in gold is that it's one of the few assets with virtually zero counterparty risk. 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 that, unlike most other investments, you can sell your gold anytime without worrying about finding another buyer. 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.
How much gold do you need in your portfolio?
The amount that you want to invest will dictate how much money it takes. A small investment of $5k-10k would be a great option if you are looking to start small. You could then rent out desks and office space as your business grows. This way, you don't have to worry about paying rent all at once. It's only one monthly payment.
It's also important to determine what type business you'll run. My company is a website creator. We charge our clients about $1000-2000 per monthly depending on what they order. This is why you should consider what you expect from each client if you're doing this kind of thing.
Because freelance work pays freelancers, you won't likely get a monthly income if you do freelance work. You may get paid just once every 6 months.
Decide what kind of income do you want before you calculate how much gold is needed.
I recommend starting with $1k-$2k in gold and working my way up.
What are the pros and disadvantages of a gold IRA
The main advantage of an Individual Retirement Account (IRA) over a regular savings account is that you don't have to pay taxes on 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.
You may lose all your accumulated savings if you take too much out of your IRA. The IRS may prevent you from taking out your IRA funds until you reach 59 1/2. 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. Others charge management fees that range from $10 to $50 per month.
If you prefer to keep your money outside a bank, you'll need to purchase insurance. A majority of insurance companies require that you possess a minimum amount gold to be eligible for a claim. You may be required by some insurers to purchase insurance that covers losses as high as $500,000.
If you are considering a Gold IRA, you need to first decide how much of it you would like to use. Some providers limit the number of ounces of gold that you can own. Others allow you the freedom to choose your own weight.
It's also important to decide whether or not to buy gold futures contracts. Futures contracts for gold are less expensive than physical gold. However, futures contracts give you flexibility when buying gold. Futures contracts allow you to create a contract with a specified expiration date.
You will also have to decide which type of insurance coverage is best for you. The standard policy does NOT include theft protection and loss due to fire or flood. It does include coverage for damage due to natural disasters. You might consider purchasing additional coverage if your area is at high risk.
Insurance is not enough. You also need to think about the cost of gold storage. Insurance won't cover storage costs. In addition, most banks charge around $25-$40 per month for safekeeping.
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 cannot sell your 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.
Once you have completed the forms, you will need to mail them to your provider with a check and a small deposit. After reviewing your application, the company will send you a confirmation mail.
Consider consulting a financial advisor when opening a golden 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.
Statistics
- 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)
- 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)
- This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (smartasset.com)
- If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (lendedu.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)
External Links
forbes.com
bbb.org
cftc.gov
investopedia.com
- Do You Need a Gold IRA to Get Retirement?
- What are the Options Types, Spreads, Example and Risk Metrics
How To
The best way online to buy gold or silver
First, understand the basics of gold. The precious metal gold is similar to platinum. It's rare and often used to make money due its resistance and durability to corrosion. It is very difficult to use and most people prefer to purchase jewelry made of it over actual bars of Gold.
There are two types currently available: legal tender and bullion. Legal tender coins are those that are intended for circulation in a country. They typically have denominations of $1, $5 or $10.
Bullion coins are only minted to be used for investment purposes. Their value increases over time because of inflation.
They aren’t exchangeable in any currency exchange. For example, if a person buys $100 worth of gold, he/she gets 100 grams of gold with a value of $100. The buyer receives 1 gram of gold for every dollar spent.
Next, you need to find out where to buy gold. If you want to purchase gold directly from a dealer, then a few options are available. First, your local currency shop is a good place to start. Another option is to go through a reputable site like eBay. You may also be interested in buying gold through private sellers online.
Private sellers are individuals who offer to sell gold at retail or wholesale prices. When selling gold through private sellers, you pay a commission fee of 10% to 15% per transaction. That means you would get back less money from a private seller than from a coin shop or eBay. This option can be a good choice for investing in gold because it allows you to control the price.
Another way to buy gold is by investing in physical gold. While physical gold is easier than paper certificates to store, you still need to make sure 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. Pawnshops are small establishments allowing customers to borrow money against items they bring. Banks typically charge higher interest rates than pawn shops.
You can also ask for help to purchase gold. Selling gold is also easy. It is easy to sell gold by contacting a company like GoldMoney.com. You can create a simple account immediately and begin receiving payments.
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By: Kevin Helms
Title: Peter Schiff Predicts Deeper Losses for Spot Bitcoin ETFs, Labels Them Bear Markets
Sourced From: news.bitcoin.com/peter-schiff-says-all-spot-bitcoin-etfs-are-now-in-bear-markets-warns-of-deeper-losses/
Published Date: Wed, 24 Jan 2024 02:00:17 +0000
Did you miss our previous article…
https://altcoinirareview.com/number-of-global-cryptocurrency-owners-surged-34-in-2023/
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