Bitcoin Hits $49K Before Dropping, ETFs Record $2.3B in Trades
At 11 a.m. Eastern Time (ET) on January 11, 2024, the newly launched spot bitcoin exchange-traded funds (ETFs) saw an impressive trading volume of $2.3 billion. However, later that afternoon, bitcoin's spot markets experienced a significant decline, with prices falling below $46,000 after briefly reaching $49,000.
Bitcoin Reaches $49K High Before Dropping
Earlier in the day, around 9 a.m. (ET), bitcoin (BTC) reached a peak value of $49,048 on Bitstamp. However, this surge to $49K was short-lived as BTC's value dropped below $46K, reaching a low of $45,700 per unit. By 11 a.m. (ET), Bloomberg's Senior ETF Analyst, Eric Balchunas, announced that the new spot bitcoin ETFs, along with Grayscale's GBTC, had collectively reached a trading volume of $2.3 billion.
Volatility and Liquidations
The introduction of spot bitcoin ETFs triggered a surge in demand, followed by profit-taking and significant market volatility. Bitcoin's 24-hour trading volume currently stands at $57.45 billion, contributing to the total $192.48 billion traded across the entire cryptocurrency market. This rapid surge and subsequent drop led to liquidations of BTC long positions, with $53.58 million being wiped out in just four hours.
In the past 24 hours, over $119 million in BTC longs were also liquidated, according to coinglass.com's liquidation metrics. The introduction of spot bitcoin ETFs has injected short-term volatility into the market, resulting in larger price swings and increased uncertainty.
Bitcoin Options and Futures
The total open interest in bitcoin options has been steadily increasing, reaching its peak at the end of December 2023. Similarly, the total open interest in bitcoin futures is experiencing a resurgence. CME Group currently leads in terms of bitcoin futures open interest with $6.59 billion, while Binance has an open interest of $4.53 billion.
Market Reaction
What are your thoughts on bitcoin's market action on Thursday when the spot bitcoin ETFs began trading? Share your opinions in the comments section below.
Frequently Asked Questions
How do you withdraw from an IRA that holds precious metals?
First, you must decide if you wish to withdraw money from your IRA account. Then make sure you have enough cash to cover any fees or penalties that may come with withdrawing funds from your retirement plan.
If you are willing to pay a penalty for early withdrawal, you should consider opening a taxable brokerage account instead of an IRA. This option is also available if you are willing to pay taxes on the amount you withdraw.
Next, determine how much money you plan to withdraw from your IRA. This calculation is dependent on several factors like your age when you take the money out, how long you have had the account, and whether or not your plan to continue contributing.
Once you have an idea of the amount of your total savings you wish to convert into cash you will need to decide what type of IRA you want. Traditional IRAs allow for you to withdraw funds without tax when you turn 59 1/2. Roth IRAs, on the other hand, charge income taxes upfront but you can access your earnings later and pay no additional taxes.
Once you have completed these calculations, you need to open your brokerage account. Most brokers offer free signup bonuses and other promotions to entice people to open accounts. It is better to open an account with a debit than a creditcard in order to avoid any unnecessary fees.
When you do finally decide to withdraw from your precious metallic IRA, you will need a safe space where you can safely store your coins. Some storage facilities will take bullion bars while others require you only to purchase individual coins. You'll have to weigh the pros of each option before you make a decision.
Bullion bars, for example, require less space as you're not dealing with individual coins. But, each coin must be counted separately. On the flip side, storing individual coins allows you to easily track their value.
Some people prefer to keep coins safe in a vault. Some people prefer to store their coins safely in a vault. You can still enjoy the benefits of bullion for many years, regardless of which method you choose.
Can I buy or sell gold from my self-directed IRA
However, gold can only be purchased with your self-directed IRA. To do so, you must first open a brokerage account at TD Ameritrade. You can also transfer funds from an existing retirement fund.
The IRS allows individuals up to $5.500 annually ($6,500 if you are married and filing jointly). This can be contributed to a traditional IRA. Individuals can contribute as much as $1,000 per year ($2,000 if married filing jointly) to a Roth IRA.
You might want to purchase physical bullion, rather than futures contracts if you are going to invest in gold. Futures contracts are financial instruments based on the price of gold. You can speculate on future prices, but not own the metal. You can only hold physical bullion, which is real silver and gold bars.
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. Consider investing in both.
In addition to being a safe investment, gold also offers potential returns. Retirees will find it an attractive investment.
While many investments promise fixed returns, gold is subject to fluctuations. Because of this, gold's value can fluctuate over time.
But this doesn't mean you shouldn't invest in gold. You should just factor the fluctuations into any overall portfolio.
Another advantage of gold is its tangible nature. Gold is much easier to store than bonds and stocks. It can also be carried.
You can always access your gold if it is stored in a secure place. Additionally, physical gold does not require storage fees.
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.
You'll also benefit from having a portion of your savings invested in something that isn't going down in value. Gold usually rises when stocks fall.
Another benefit to investing in gold? You can always sell 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. Do not put all your eggs in one basket.
Don't buy too many at once. Begin by buying a few grams. Add more as you're able.
Remember, the goal here isn't to get rich quickly. 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.
Can I have physical gold in my IRA
Not just paper money or coins, gold is money. Gold is an asset people have used for thousands years as a place to store value and protect their wealth from economic uncertainty and inflation. Gold is a part of a diversified portfolio that investors can use to protect their wealth from financial uncertainty.
Many Americans today prefer to invest in precious metals, such as silver and gold, over stocks and bonds. While owning gold doesn't guarantee you'll make money investing in gold, there are several reasons why it may make sense to consider adding gold to your retirement portfolio.
Another reason is the fact that gold historically has performed better than other assets in times of financial panic. Gold prices rose nearly 100 percent between August 2011 and early 2013, while the S&P 500 fell 21 percent over the same period. Gold was one of the few assets that performed better than stocks during turbulent market conditions.
Gold is one of the few assets that has virtually no counterparty risks. Even if your stock portfolio is down, your shares are still yours. If you have gold, it will still be worth your shares even if the company in which you invested defaults on its debt.
Finally, gold is liquid. This means that, unlike most other investments, you can sell your gold anytime without worrying about finding another buyer. The liquidity of gold makes it a good investment. This allows you take advantage of the short-term fluctuations that occur in the gold markets.
How much are gold IRA fees?
A monthly fee of $6 for an Individual Retirement Account is charged. This includes account maintenance fees and investment costs for your chosen investments.
If you wish to diversify your portfolio, you may need to pay additional fees. These fees can vary depending on which type of IRA account you choose. For example, some companies offer free checking accounts but charge monthly fees for IRA accounts.
Most providers also charge annual management costs. These fees vary from 0% to 11%. The average rate for a year is.25%. These rates are usually waived if you use a broker such as TD Ameritrade.
Statistics
- 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)
- 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)
- 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
irs.gov
cftc.gov
bbb.org
investopedia.com
- Do You Need a Gold IRA to Get Retirement?
- What are the Options Types, Spreads, Example, and Risk Metrics
How To
Gold IRAs: A Growing Trend
The gold IRA trend is growing as investors seek ways to diversify their portfolios while protecting against inflation and other risks.
Owners can invest in gold bars and bullion with the gold IRA. It can be used for tax-free growth and provides an alternative investment option for those concerned about stocks and bonds.
Investors can have confidence in their investments and avoid market volatility with a gold IRA. They can use the gold IRA to protect themselves against inflation and other potential problems.
Investors also have the benefit of physical gold, which has unique properties such durability, portability and divisibility.
Additional benefits of the gold IRA include the ability to quickly pass ownership to heirs. Additionally, the IRS does not consider gold a money or a commodity.
Investors looking for financial security are increasingly turning to the gold IRA.
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By: Jamie Redman
Title: Bitcoin ETF Trades Reach $2.3B as BTC Price Surges and Plummets
Sourced From: news.bitcoin.com/record-2-3b-in-bitcoin-etf-trades-as-btc-rockets-to-49k-then-plummets-below-46k/
Published Date: Thu, 11 Jan 2024 19:00:36 +0000
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