Bears Take the Reigns—Bitcoin Falls Under $40K Amid Market Turbulence
On Monday, Jan. 22, 2024, bitcoin's value dropped below the $40K mark, marking the first time in 48 days that it has fallen to this level. This decline has triggered a market-wide slide in the cryptocurrency industry. Over the past 24 hours, bitcoin has experienced a 4% decrease, with a 14.2% drop observed over the preceding two weeks.
A Break in the Streak—Bitcoin's Price Below $40K
Since Dec. 5, 2023, bitcoin's price has consistently remained above the $40K threshold. However, the leading cryptocurrency recently faced a setback. On Jan. 10, 2024, it reached a peak of $49,000, but this high was short-lived. Subsequently, the price started to decline and eventually fell into the $45K range. In the last few days, bitcoin has struggled to maintain its position above $40K and finally dipped below this threshold at 2:15 p.m. Eastern Time (ET) on Monday.
Current State of Bitcoin
As of 2:15 p.m., the value of bitcoin has dropped to approximately $39,400. The trade volume during this time is about $25.81 billion, which is a significant increase compared to the $16.58 billion recorded at 8:00 a.m. (ET). Short-term indicators suggest that bitcoin is currently experiencing a downward trend characterized by increased volatility and a notable decrease in value. The surge in trading volume during this downturn indicates a potential panic-induced selling spree, especially as the price falls below the psychological support level of $40,000.
The Impact on the Market
Bitcoin's recent price dip has had a ripple effect on various cryptocurrencies, contributing to a 3.02% decline in the overall $1.59 trillion crypto market economy on Monday. Ethereum has dropped by 6%, BNB by 4.5%, SOL by 9.4%, and XRP has seen a 4.7% decrease within the same timeframe.
What are your thoughts on bitcoin plunging below the $40K range on Monday? Feel free to share your opinions in the comments section below.
Frequently Asked Questions
Is gold a good choice for an investment IRA?
Any person looking to save money is well-served by gold. You can also diversify your portfolio by investing in gold. But gold is not all that it seems.
It has been used throughout the history of currency and remains a popular payment method. It is sometimes called the “oldest currency in the world”.
Gold, unlike other paper currencies created by governments is mined directly from the earth. That makes it very valuable because it's rare and hard to create.
The supply and demand for gold determine the price of gold. The strength of the economy means people spend more, and so, there is less demand for gold. This results in gold prices rising.
The flip side is that people tend to save money when the economy slows. This results in more gold being produced, which drives down its value.
This is why investing in gold makes sense for individuals and businesses. You will benefit from economic growth if you invest in gold.
Also, your investments will earn you interest which can help increase your wealth. In addition, you won’t lose any money if gold falls in value.
What are the advantages of a gold IRA
The best way to save money for retirement is to place it in an Individual Retirement Account. It's tax-deferred until you withdraw it. You control how much you take each year. There are many types of IRAs. Some are better suited for college students. Others are designed for investors looking for higher returns. Roth IRAs let individuals contribute after age 591/2 and pay tax on any earnings at retirement. But once they start withdrawing funds, those earnings aren't taxed again. This account is a good option if you plan to retire early.
Because it allows you money to be invested in multiple asset classes, a ‘gold IRA' is similar to any other IRAs. Unlike a regular IRA that requires you to pay taxes on the gains you make while you wait to access them, a gold IRA does not have to do this. This makes gold IRA accounts a great choice for those who want their money to be invested, not spent.
Another benefit to owning IRA gold is the ability to withdraw automatically. It means that you don’t have to remember to make deposits every month. Direct debits could be set up to ensure you don't miss a single payment.
Finally, the gold investment is among the most reliable. Its value is stable because it's not tied with any one country. Even during economic turmoil the gold price tends to remain fairly stable. Therefore, gold is often considered a good investment to protect your savings against inflation.
How does a gold IRA account work?
Gold Ira accounts are tax-free investment vehicles for people who want to invest in precious metals.
You can purchase physical bullion gold coins at any point in time. To start investing in gold, it doesn't matter if you are retired.
An IRA lets you keep your gold for life. Your gold holdings will not be subject to tax when you are gone.
Your heirs will inherit your gold, and not pay capital gains taxes. It is not required that you include your gold in the final estate report because it remains outside your estate.
To open a gold IRA, you will first need to create an individual retirement account (IRA). After you have done this, an IRA custodian will be assigned to you. This company acts as an intermediary between you and IRS.
Your gold IRA Custodian will manage the paperwork and submit all necessary forms to IRS. This includes filing annual reports.
Once your gold IRA is established, you can purchase gold bullion coins. The minimum deposit is $1,000. You'll get a higher rate of interest if you deposit more.
When you withdraw your gold from your IRA, you'll pay taxes on it. If you are withdrawing your entire balance, you will owe income tax plus a 10% penalty.
You may not be required to pay taxes if you take out only a small amount. There are some exceptions, though. For example, taking out 30% or more of your total IRA assets, you'll owe federal income taxes plus a 20 percent penalty.
You shouldn't take out more then 50% of your total IRA assets annually. A violation of this rule can lead to severe financial consequences.
What proportion of your portfolio should you have in precious metals
To answer this question we need to first define precious metals. Precious elements are those elements which have a high price relative to other commodities. This makes them extremely valuable for trading and investing. Gold is by far the most common precious metal traded today.
There are however many other types, including silver, and platinum. The price volatility of gold can be unpredictable, but it is generally stable during periods of economic turmoil. It is also relatively unaffected both by inflation and deflation.
In general, all precious metals have a tendency to go up with the market. They do not always move in the same direction. For example, when the economy is doing poorly, the price of gold typically rises while the prices of other precious metals tend to fall. Investors expect lower interest rates which makes bonds less appealing investments.
Contrary to this, when the economy performs well, the opposite happens. Investors want safe assets such Treasury Bonds and are less inclined to demand precious metals. They are more rare, so they become more expensive and less valuable.
Diversifying across precious metals is a great way to maximize your investment returns. 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.
How is gold taxed in 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.
The money can be withdrawn tax-free if it's deposited in a traditional IRA (or 401(k)). Dividends and capital gains are exempt from tax. Capital gains only apply to investments more than one years old.
Each state has its own rules regarding these accounts. Maryland is an example of this. You must withdraw your funds within 60 calendar days of turning 59 1/2. Massachusetts allows you to wait until April 1. New York is open until 70 1/2. To avoid any penalties, plan your retirement savings and take your distributions as early as possible.
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)
- (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)
- 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)
External Links
finance.yahoo.com
investopedia.com
forbes.com
- Gold IRA – Add Sparkle to Your Retirement Nest Egg
- Understanding China's Evergrande Crisis – Forbes Advisor
cftc.gov
How To
The best place to buy silver or gold online
Before you can buy gold, it is important to understand its workings. It is a precious metal that is very similar to platinum. It's rare and often used to make money due its resistance and durability 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 are minted for investment purposes only, and their values increase over time due to inflation.
They are not exchangeable in any currency exchange system. For example, if a person buys $100 worth of gold, he/she gets 100 grams of gold with a value of $100. Every dollar spent on gold purchases, the buyer receives one gram of gold.
When looking to buy precious metals, the next thing you should be aware of is where it can be purchased. There are many options for buying gold directly from dealers. First off, you can go through your local coin shop. You could also look into eBay or other reputable websites. You can also look into buying gold online from private sellers.
Individuals selling gold at wholesale prices and retail prices are known as private sellers. Private sellers will charge you a 10% to 15% commission for every transaction. You would receive less money from a private buyer than you would from a coin store or eBay. However, this option is often a great choice when investing in gold since it gives you more control over the item's price.
Another way to buy gold is by investing in physical gold. Physical gold is much easier to store than paper certificates, but you still have to worry about storing it safely. Physical gold should be stored in an impenetrable container, such a vault and safety deposit box to ensure its safety.
A bank or pawnshop can help you buy gold. A bank will provide you with a loan that allows you to purchase the amount of gold you desire. These are small businesses that let customers borrow money against the items they bring to them. Banks typically charge higher interest rates than pawn shops.
Another way to purchase gold is to ask another person to do it. Selling gold can be as easy as selling. Set up a simple account with GoldMoney.com and you will start receiving payments instantly.
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By: Jamie Redman
Title: Bitcoin Plummets Below $40K for First Time in 48 Days, Triggering Market-Wide Crypto Slide
Sourced From: news.bitcoin.com/bitcoin-plummets-below-40k-for-first-time-in-48-days-triggering-market-wide-crypto-slide/
Published Date: Mon, 22 Jan 2024 20:22:40 +0000
