Swan Bitcoin, a prominent bitcoin exchange platform, has recently announced its decision to terminate the accounts of users who directly interact with mixing services. This move comes in response to pressure from banking institutions following the proposal presented by the Financial Crimes Enforcement Network (FinCEN) to increase the bookkeeping requirements for such transactions.
Swan Bitcoin Introduces Restrictive Policies for Mixing Services
In a letter addressed to its customers, Swan Bitcoin, a California-based Bitcoin services platform, has unveiled its updated policies concerning mixing services. The company stated that accounts that engage with transactions originating from or going to coin mixing services will now face the risk of termination.
This change is a direct result of the pressure exerted by the company's banking partners due to the introduction of a proposed rule by the Financial Crimes Enforcement Network (FinCEN). The rule aims to establish additional responsibilities for institutions facilitating transactions involving mixing services.
Yan Pritzker, co-founder and CTO of Swan Bitcoin, explained that while the company supports coin mixing as a privacy service, it is necessary to connect with qualified custodians and banks to onboard customers with fiat. Rather than engaging in investigative work, the company prefers to eliminate risks altogether.
"Game theoretically, this behavior is expected and obvious. Why should a bank have to do extra work to prove innocence when the government has been telling them for years that they don't want to see mixing?"
Backlash from the Crypto Community
Despite Pritzker's explanation, several members of the crypto community have expressed their opposition to Swan's new policies, arguing that they contradict the ethos of the exchange.
Samourai Wallet, a wallet known for its mixing services, strongly criticized Swan Bitcoin's actions, accusing the exchange of acting as an enforcer for a proposal that is not even law yet. They urged users to close their accounts or engage with mixing services to force the exchange to terminate them.
Samourai Wallet emphasized:
"It's still a proposal, you lame f*cking p*ssies. Instead of mounting a defense, you preemptively comply? Absolute losers."
Vlad Costea, the host of the Bitcoin Takeover podcast, also condemned Swan Bitcoin's actions, describing them as "dystopian" and an attempt to establish an anti-Bitcoin compliance culture. He concluded by stating that if he had access to Swan, he would immediately cease using the service.
What are your thoughts on Swan Bitcoin's new account termination policies? Share your opinions in the comments section below.
Frequently Asked Questions
What tax is gold subject in an IRA
The fair market value at the time of sale is what determines how much tax you pay on gold sales. When you purchase gold, you don't have to pay any taxes. It is not considered income. If you decide to sell it later, there will be a taxable gain if its price rises.
As collateral for loans, gold is possible. Lenders seek to get the best return when you borrow against your assets. This usually involves selling your gold. This is not always possible. They might keep it. Or they might decide to resell it themselves. Either way, you lose potential profit.
So to avoid losing money, you should only lend against your gold if you plan to use it as collateral. It is better to leave it alone.
What is a Precious Metal IRA (IRA)?
A precious metal IRA allows you to diversify your retirement savings into gold, silver, platinum, palladium, rhodium, iridium, osmium, and other rare metals. These rare metals are often called “precious” as they are very difficult to find and highly valuable. These are excellent investments that will protect your wealth from inflation and economic instability.
Bullion can be bought through many channels, including online retailers, large coins dealers, and some grocery shops.
You can invest directly in bullion with a precious metal IRA instead of buying shares of stock. This will ensure that you receive annual dividends.
Precious metal IRAs have no paperwork or annual fees. Instead, you pay only a small percentage tax on your gains. You can also access your funds whenever it suits you.
How to Open a Precious Metal IRA
It is important to decide if you would like an Individual Retirement Account (IRA). You must complete Form 8606 to open an account. For you to determine the type and eligibility for which IRA, you need Form 5204. This form should be filled within 60 calendar days of opening the account. Once you have completed this form, it is possible to begin investing. You can also choose to pay your salary directly by making a payroll deduction.
If you opt for a Roth IRA, you must complete Form 8903. The process for an ordinary IRA will not be affected.
You'll need to meet specific requirements to qualify for a precious metals IRA. You must be at least 18 years of age and have earned income to qualify for a precious metals IRA. Your annual earnings cannot exceed $110,000 ($220,000 if you are married and file jointly) for any tax year. Contributions must be made regularly. These rules apply whether you're contributing through an employer or directly from your paychecks.
You can invest in precious metals IRAs to buy gold, palladium and platinum. But, you'll only be able to purchase physical bullion. You won't have the ability to trade stocks or bonds.
However, there are two significant drawbacks to investing in precious metals via an IRA. They aren't as liquid as bonds or stocks. This makes it harder to sell them when needed. Second, they don't generate dividends like stocks and bonds. Therefore, you will lose money over time and not gain it.
How much money should my Roth IRA be funded?
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 your goal is to withdraw funds before that time, there are certain rules you must observe. First, you can't touch your principal (the initial amount that was deposited). 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. Also, taxes will be due on any earnings you take. Let's take, for example, $5,000 in annual Roth IRA contributions. Let's further assume you earn $10,000 annually after contributing. This would mean that you would have to pay $3,500 in federal income tax. So you would only have $6,500 left. 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. Additionally, half of your earnings would be lost because they will be taxed at 50% (half the 40%). So, even though you ended up with $7,000 in your Roth IRA, you only got back $4,000.
There are two types if Roth IRAs, Roth and Traditional. Traditional IRAs allow you to deduct pretax contributions from your taxable income. Your traditional IRA allows you to withdraw your entire contribution plus any interest. You have the option to withdraw any amount from a traditional IRA.
Roth IRAs won't let you deduct your contributions. But once you've retired, you can withdraw the entire contribution amount plus any accrued interest. 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.
How much should precious metals make up your portfolio?
To answer this question, we must first understand what precious metals are. Precious elements are those elements which have a high price relative to other commodities. This makes them highly valuable for both investment and trading. Gold is currently the most widely traded precious metal.
There are also many other precious metals such as platinum and silver. The price of gold fluctuates, but it generally remains stable during times of economic turmoil. It is not affected by inflation or deflation.
The general trend is for precious metals to increase in price with the overall market. That said, they do not always move in lockstep with each other. For instance, gold's price will rise when the economy is weak, while precious metals prices will fall. This is because investors expect lower rates of interest, which makes bonds less attractive investments.
In contrast, when the economy is strong, the opposite effect occurs. Investors are more inclined to invest in safe assets, such as Treasury Bonds, and they will not 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. 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 much should you have of gold in your portfolio
The amount of money you need to make depends on how much capital you are looking for. Start small with $5k-10k. As you grow, it is possible to rent desks or office space. You don't need to worry about paying rent every month. You just pay per month.
It's also important to determine what type business you'll run. In my case, we charge clients between $1000-2000/month, depending on what they order. Consider how much you expect to make from each client, if you decide to do this kinda thing.
Freelance work is not likely to pay a monthly salary. The project pays freelancers. You might get paid only once every six months.
So you need to decide what kind of income you want to generate before you know how much gold you will need.
I recommend starting with $1k to $2k of gold, and then growing from there.
- 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)
- Gold is considered a collectible, and profits from a sale are taxed at a maximum rate of 28 percent. (aarp.org)
- 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)
- This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (smartasset.com)
- Instead, the economy improved, stocks rebounded, and gold plunged, losing 28 percent of its value in 2013. (aarp.org)
- 7 U.S. Code SS 7 – Designation of boards of trade as contract markets
- 26 U.S. Code SS 408 – Individual retirement funds
- Saddam Hussein's InvasionHelped Uncage a Bear In 1991 – WSJ
- Want to Keep Gold in Your IRA at Home? It's Not Exactly Legal – WSJ
Tips to Invest in Gold
Investing in Gold has become a very popular investment strategy. Because investing in gold has many benefits. There are many ways to invest gold. Some people buy physical gold coins, while others prefer investing in gold ETFs (Exchange Traded Funds).
You should consider some things before you decide to purchase any type of gold.
- First, verify that your country permits gold ownership. If so, then you can proceed. You can also look at buying gold abroad.
- Secondly, you should know what kind of gold coin you want. You can go for yellow gold, white gold, rose gold, etc.
- The third factor to consider is the price for gold. Start small and move up. Diversifying your portfolio is a key thing to remember when purchasing gold. You should invest in different assets such as stocks, bonds, real estate, mutual funds, and commodities.
- Don't forget to keep in mind that gold prices often change. You need to keep up with current trends.
By: Sergio Goschenko
Title: Swan Bitcoin Implements New Policies to Terminate Accounts Engaging with Bitcoin Mixing Services
Sourced From: news.bitcoin.com/swan-bitcoin-to-terminate-accounts-interacting-with-bitcoin-mixing-services/
Published Date: Tue, 14 Nov 2023 05:30:03 +0000