A Resilient Year for USDC Amidst Market Shifts
A recent report released by Circle, the issuer of the USD Coin (USDC), titled "State of the USDC Economy," sheds light on the current trends and changing dynamics of USDC, as well as its position in the "new internet financial system."
The year 2023 posed several challenges for USDC. This stablecoin, which is pegged to the U.S. dollar and backed by liquid cash and cash-equivalent assets, experienced a significant decrease in its circulating supply, dropping from $45 billion to $25 billion – a decline of 44%. This reduction can be attributed to the migration of assets from the crypto ecosystem to traditional markets. This shift was driven by various factors, including rising interest rates, regulatory pressures, industry bankruptcies, and fraud incidents.
However, amidst these challenges, the number of wallets holding at least $10 of USDC increased by 59%, surpassing 2.7 million. This growth occurred despite the broader contraction in the crypto sector, indicating a strong vote of confidence in USDC. The stablecoin served as a crucial link between the crypto asset economy and traditional finance, with a total of over $197 billion worth of USDC issued or burned throughout the year.
Notably, the Asia-Pacific region experienced a surge in USDC usage for remittances, with $130 billion flowing into the region in 2022. Circle's initiatives in this region included a partnership with Coins.ph, a Philippines-based exchange, aimed at capturing a share of the $36 billion remittance market. The report also highlights USDC's role in bridging the $510 billion trade finance gap in emerging markets.
The report emphasizes the increasing adoption of USDC for practical purposes such as remittances and trade finance. Simultaneously, it notes a significant decline in USDC's involvement in speculative trading, which has dropped by 90% over the past five years.
What stablecoin do you prefer? Share your thoughts and opinions on this subject in the comments section below.
Frequently Asked Questions
How much should your IRA include precious metals
It is important to remember that precious metals can be a good investment for anyone. You don’t need to have a lot of money to invest. 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. Shares in precious metals-producing companies could be an option. You might also want to use an IRA rollover program offered through your retirement plan provider.
No matter what your preference, precious metals will still be of benefit to you. These metals are not stocks, but they can still provide long-term growth.
Their prices are more volatile than traditional investments. This means that if you decide on selling your investment later, you'll likely get more profit than you would with traditional investing.
How can you withdraw from an IRA of Precious Metals?
First, decide if it is possible to withdraw funds from an IRA. Next, ensure you have enough cash on hand to pay any penalties or fees that could be associated with withdrawing funds.
If you are willing to pay a penalty for early withdrawal, you should consider opening a taxable brokerage account instead of an IRA. If you choose this option, you'll also need to consider taxes owed on the amount withdrawn.
Next, you'll need to figure out how much money you will take out of your IRA. The calculation is influenced by several factors such as your age at withdrawal, the length of time you have owned the account and whether or not you plan to continue contributing to retirement plans.
Once you have determined the percentage of your total savings that you would like to convert to cash, you can then decide which type of IRA to use. Traditional IRAs permit you to withdraw your funds tax-free once you turn 59 1/2. Roth IRAs have income taxes upfront, but you can access the earnings later on without paying additional taxes.
Once these calculations have been completed you will need to open an account with a brokerage. Brokers often offer promotional offers and signup bonuses to encourage people into opening accounts. It is better to open an account with a debit than a creditcard in order to avoid any unnecessary fees.
You will need a safe place to store your coins when you are ready to withdraw from your precious metal IRA. While some storage facilities accept bullion bars and others require that you purchase individual coins, others will allow you to store your coins in their own safe. Before choosing one, consider the pros and disadvantages of each.
Bullion bars, for example, require less space as you're not dealing with individual coins. But, each coin must be counted separately. However, you can easily track the value of individual coins by storing them in separate containers.
Some prefer to keep their money in a vault. Others prefer to place them in safe deposit boxes. Whichever method you choose, make sure you store your bullion safely so you can enjoy its benefits for years to come.
Who is the owner of the gold in a gold IRA
The IRS considers any individual who holds gold “a form of income” that is subject to taxation.
You must have at least $10,000 in gold and keep it for at most five years to qualify for this tax-free status.
While gold may be a great investment to help prevent inflation and volatility in the market, it's not wise to keep it if you won't use it.
If you plan to sell the gold one day, you will need to report its worth. This will affect how much capital gains tax you owe on cash you have invested.
Consult a financial advisor or accountant to determine your options.
What are the pros and disadvantages of a gold IRA
An Individual Retirement account (IRA) is a better option than regular savings accounts in that interest earned is exempted from tax. This makes an IRA great for people who want to save money but don't want to pay tax on the interest they earn. This type of investment has its downsides.
You may lose all your accumulated savings if you take too much out of your IRA. You might also not be able to withdraw from your IRA until the IRS deems you to be 59 1/2. You will likely have to pay a penalty fee if you withdraw funds from an IRA.
You will also need to pay fees for managing your IRA. Most banks charge 0.5% to 2.0% per annum. Other providers charge monthly management charges ranging anywhere from $10 to $50.
If you prefer to keep your money outside a bank, you'll need to purchase insurance. In order to make a claim, most insurers will require that you have a minimum amount in gold. Insurance that covers losses upto $500,000.
If you decide to open a gold IRA, it is important to know how much you can use. You may be limited in the amount of gold you can have by some providers. Some providers allow you to choose your weight.
It is also up to you to decide whether you want to purchase physical gold or futures. Gold futures contracts are more expensive than physical gold. Futures contracts provide flexibility for purchasing gold. Futures contracts allow you to create a contract with a specified expiration date.
It is also important to choose the type of insurance coverage that you need. The standard policy doesn’t provide theft protection or loss due fire, flood, or earthquake. It does include coverage for damage due to natural disasters. Additional coverage may be necessary if you reside in high-risk areas.
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.
Before you can open a gold IRA you need to contact a qualified Custodian. A custodian keeps track of your investments and ensures that you comply with federal regulations. Custodians aren't allowed to sell your assets. Instead, they must maintain them for as long a time as you request.
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. Your monthly investment goal should be stated.
After filling out the forms, you'll need to send them to your chosen provider along with a check for a small deposit. The company will then review your application and mail you a letter of confirmation.
You should consult a financial planner before opening a Gold IRA. A financial planner is an expert in investing and can help you choose the right type of IRA for you. You can also reduce your insurance costs by working with them to find lower-cost alternatives.
Statistics
- You can only purchase gold bars at least 99.5% purity. (forbes.com)
- Instead, the economy improved, stocks rebounded, and gold plunged, losing 28 percent of its value in 2013. (aarp.org)
- 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)
- Gold is considered a collectible, and profits from a sale are taxed at a maximum rate of 28 percent. (aarp.org)
External Links
law.cornell.edu
- 7 U.S. Code SS7 – Designation Boards of Trade as Contract Markets
- 26 U.S. Code SS 408 – Individual retirement accounts
irs.gov
forbes.com
finance.yahoo.com
How To
The History of Gold as an Asset
Gold was a currency from ancient times until the early 20th century. It was popular because of its purity, divisibility. uniformity. scarcity and beauty. It was also traded internationally due to its high value. Because there were no internationally recognized standards for measuring and weighing gold, the different weights of this metal could be used worldwide. For example, in England, one pound sterling was equal to 24 carats of silver; in France, one livre tournois was equal to 25 carats of gold; in Germany, one mark was equal to 28 carats of gold; etc.
The United States started issuing American coins in the 1860s made of 90% copper and 10% zinc. This led to a decline in demand for foreign currencies, which caused their price to increase. In this period, large amounts of gold coin were minted by the United States, which caused the gold price to drop. Because the U.S. government had too much money coming into circulation, they needed to find a way to pay off some debt. To do this, they decided that some of their excess gold would be sold back to Europe.
Since most European countries were not confident in the U.S. dollar they began accepting gold as payment. Many European countries started to accept paper money as a substitute for gold after World War I. The value of gold has significantly increased since then. Today, although the price fluctuates, gold remains one of the safest investments you can make.
—————————————————————————————————————————————————————————————–
By: David Sencil
Title: USDC Navigates Challenging Waters in 2023, According to Circle Report
Sourced From: news.bitcoin.com/circle-report-shows-usdc-navigating-challenging-waters-in-2023/
Published Date: Wed, 17 Jan 2024 11:00:11 +0000
