Goldman Sachs Advises Investors Against Anticipating Immediate Bitcoin Price Surge Following Spot Bitcoin ETF Approvals
Goldman Sachs on Spot Bitcoin ETF Hype
Global investment bank Goldman Sachs has stated that investors should not expect an immediate surge in the price of bitcoin after the approval of spot bitcoin exchange-traded funds (ETFs) by the U.S. Securities and Exchange Commission (SEC). However, Goldman Sachs has acknowledged the positive aspect of being able to transact a familiar and scalable product.
According to Mathew McDermott, head of the digital asset unit at Goldman Sachs, the bank does not anticipate a sudden increase in BTC prices upon the approval of the ETFs. McDermott mentioned that the approval could attract new institutional investors to the asset class. He said:
"This ability to actually transact a product that people are familiar with and can provide scale, I think is very positive."
Goldman Sachs currently offers cryptocurrency derivatives trading for institutional clients, but does not trade the underlying asset itself. McDermott also mentioned that client interest in crypto derivatives trading has been growing, driven by expectations of the imminent approval of spot bitcoin ETF applications by the SEC. Although he noted that the crypto market is still relatively small, he stated:
"Definitely as the market's getting more excited about the potential of a bitcoin ETF, there's definitely been more interest."
McDermott also expressed his focus on developing digital assets beyond cryptocurrency. This includes exploring the issuance of blockchain-based tokens representing traditional assets such as bonds. He highlighted a significant appetite for digital assets, which has grown significantly in the past year. Furthermore, he believes that leveraging blockchain technology can enhance operational and settlement efficiencies, as well as contribute to the de-risking of financial markets.
McDermott predicts a significant increase in on-chain trading within the next one to two years, and expects to see these marketplaces at scale within three to five years. However, he believes that fully replicating the majority of financial markets exclusively on blockchain is a distant possibility.
Do you agree with Goldman Sachs' head of digital assets? Are you expecting a significant increase in BTC prices upon SEC approval of spot bitcoin ETFs? Let us know in the comments section below.
Frequently Asked Questions
Do You Need to Open a Precious Metal IRA
Before opening an IRA, it is important to understand that precious metals aren't covered by insurance. You cannot recover any money you have invested. This includes losing all your investments due to theft, fire, flood, etc.
Investing in physical gold and silver coins is the best way to protect yourself from this type of loss. These coins have been around for thousands and represent a real asset that can never be lost. If you were to offer them for sale today, they would likely fetch you more than you paid when you bought them.
Consider a reputable business that offers low rates and good products when opening an IRA. It is also a smart idea to use a third-party trustee who will help you have access to your assets at all times.
When you open an account, keep in mind that you won't receive any returns until your retirement. Remember the future.
Can the government seize your gold?
Your gold is yours, so the government cannot confiscate it. It is yours because you worked hard for it. It belongs to you. This rule could be broken by exceptions. For example, if you were convicted of a crime involving fraud against the federal government, you can lose your gold. If you owe taxes, your precious metals could be taken away. However, even if you don't pay your taxes, your gold can be kept as property of the United States Government.
How is gold taxed in Roth IRA?
The tax on an investment account is based on its current value, not what you originally paid. So if you invest $1,000 in a mutual fund or stock and then sell it later, any gains are subject to taxes.
If you place the money in a traditional IRA, 401(k), or other retirement plan, there is no tax when you take it out. You pay taxes only on earnings from dividends and capital gains — which apply only to investments held longer than one year.
These accounts are subject to different rules depending on where you live. In Maryland, for example, withdrawals must be made within 60 days of reaching the age of 59 1/2 in order to qualify. Massachusetts allows you to wait until April 1. New York offers a waiting period of up to 70 1/2 years. To avoid penalty fees, it is important to plan and take distributions in time to pay all your retirement savings.
How much of your portfolio should you hold in precious metals
Before we can answer this question, it is important to understand what precious metals actually are. Precious elements are those elements which have a high price relative to other commodities. They are therefore very attractive for investment and trading. Today, gold is the most commonly traded precious metal.
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 unaffected significantly by inflation and Deflation.
In general, all precious metals have a tendency to go up with the market. However, the prices of precious metals do not always move in sync with one another. The price of gold tends to rise when the economy is not doing well, but the prices of the other precious metals tends downwards. This is because investors expect lower interest rates, making bonds less attractive investments.
However, when an economy is strong, the reverse effect occurs. Investors want safe assets such Treasury Bonds and are less inclined to demand precious metals. These precious metals are rare and become more costly.
Diversifying across precious metals is a great way to maximize your investment returns. Furthermore, because the price of precious Metals fluctuates, it is best not to focus on just one type of precious Metals.
How much gold should your portfolio contain?
The amount of capital that you require will determine how much money you can make. You can start small by investing $5k-10k. As your business grows, you might consider renting out office space or desks. You don't need to worry about paying rent every month. It's only one monthly payment.
You also need to consider what type of business you will run. My website design company charges clients $1000-2000 per month depending on the order. So if you do this kind of thing, you need to consider how much income you expect from each client.
Freelance work is not likely to pay a monthly salary. The project pays freelancers. You might get paid only once every six months.
You must first decide what kind and amount of income you are looking to generate before you can calculate how much gold will be needed.
I recommend starting with $1k to $2k of gold, and then growing from there.
How much money should my Roth IRA be funded?
Roth IRAs are retirement accounts that allow you to withdraw your money tax-free. You cannot withdraw funds from these accounts until you reach 59 1/2. If you decide to withdraw some of your contributions, you will need to follow certain rules. First, you cannot touch your principal (the original amount deposited). This means that regardless of how much you contribute to an account, you cannot take out any more than you initially contributed. You must pay taxes on the difference if you want to take out more than what you initially contributed.
The second rule says that you cannot withdraw your earnings without paying income tax. When you withdraw, you will have to pay income tax. Let's suppose that you contribute $5,000 annually to your Roth IRA. Let's also assume that you make $10,000 per year from your Roth IRA contributions. On the earnings, you would be responsible for $3,500 federal income taxes. This leaves you with $6,500 remaining. This is the maximum amount you can withdraw because you are limited to what you initially contributed.
The $4,000 you take out of your earnings would be subject to taxes. You'd still owe $1,500 in taxes. 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%). Even though you had $7,000 in your Roth IRA account, 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. Your traditional IRA can be used to withdraw your balance and interest when you are retired. You can withdraw as much as you want from a traditional IRA.
Roth IRAs are not allowed to allow you deductions for contributions. You can withdraw your entire contribution, plus accrued interests, after you retire. There is no minimum withdrawal requirement, unlike traditional IRAs. It doesn't matter if you are 70 1/2 or older before you withdraw your contribution.
Is gold buying a good retirement option?
Although gold investment may not seem appealing at first glance due to the high average global gold consumption, it's worth considering.
Physical bullion bars are the most popular way to invest in gold. However, there are many other ways to invest in gold. It is best to research all options and make informed decisions based on your goals.
If you're not looking to secure your wealth, it may be worth considering purchasing shares in mining equipment or companies that extract gold. If you are looking for cash flow from your investment, buying gold stocks will work well.
ETFs allow you to invest in exchange-traded funds. These funds give you exposure, but not actual gold, by investing in gold-related securities. These ETFs may include stocks that are owned by gold miners or precious metals refining companies as well as commodity trading firms.
Statistics
- (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)
- 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)
- 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)
- If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (lendedu.com)
External Links
investopedia.com
bbb.org
forbes.com
- Gold IRA – Add Sparkle to Your Retirement Nest Egg
- Understanding China's Evergrande Crisis – Forbes Advisor
law.cornell.edu
- 7 U.S. Code SS7 – Designation boards of trade as contract market authorities
- 26 U.S. Code SS 408 – Individual retirement account
How To
3 Ways To Invest in Gold For Retirement
It's crucial to understand where gold fits in your retirement strategy. If you have a 401(k) account at work, there are several ways you can invest in gold. You might also consider investing in gold outside your workplace. If you have an IRA (Individual Retirement Account), a custodial account could be opened at Fidelity Investments. Or, if you don't already own any precious metals, you may want to consider buying them directly from a reputable dealer.
If you do invest in gold, follow these three simple rules:
- You can buy gold with your cash – No need to use credit cards or borrow money for investment financing. Instead, deposit cash into your accounts. This will help you to protect yourself against inflation while also preserving your purchasing power.
- Own Physical Gold Coins – You should buy physical gold coins rather than just owning a paper certificate. The reason is that it's much easier to sell physical gold coins than certificates. Also, there are no storage fees associated with 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 helps reduce risk and gives you more flexibility during market volatility.
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By: Kevin Helms
Title: Goldman Sachs: Don’t Expect Immediate BTC Spike After Spot Bitcoin ETF Approvals
Sourced From: news.bitcoin.com/goldman-sachs-dont-expect-immediate-btc-spike-after-spot-bitcoin-etf-approvals/
Published Date: Sun, 17 Dec 2023 05:00:13 +0000
