The Hong Kong Securities and Futures Commission (SFC) has issued a reminder to crypto investors in the region, emphasizing the importance of using or trading on approved virtual asset trading platforms (VATPs). The SFC's latest statement, released on February 5, 2024, urges investors to verify a VATP's regulatory status before engaging in any transactions.
Warning Against Unlicensed Operators
This recent warning from the Hong Kong regulator follows a previous request for users to avoid using unlicensed operators. The SFC expressed doubts about the realistic prospects of many of these entities obtaining a license. The current warning serves as a reminder to investors to exercise caution and only trade on platforms that have been approved by the SFC.
The Importance of the Approved Lists
The SFC advises investors to pay close attention to the two lists of approved VATPs. The first list, titled "List of licensed virtual asset trading platforms," features VATPs that have been formally licensed by the SFC. The second list, "List of virtual asset trading platform applicants," includes VATPs that have submitted license applications to the SFC on or before February 29, 2024.
The SFC clarifies that virtual asset service providers (VATPs) failing to submit their license applications by February 29 will be required to cease operations by May 31. Therefore, investors are encouraged to use VATPs featured on either list or consider transferring their funds to licensed VATPs to ensure the safety of their investments.
Risks of Trading on Unapproved Platforms
The SFC warns that trading on VATPs that are not featured on either list carries a significant risk. The regulator highlights that these platforms offer zero protection to users and may not have undergone the necessary regulatory scrutiny. Therefore, investors are strongly advised to avoid trading on unapproved VATPs to safeguard their assets.
It is crucial for crypto investors in Hong Kong to stay informed about the approved virtual asset trading platforms and adhere to the SFC's guidelines. By using only licensed and regulated platforms, investors can mitigate risks and ensure a safer trading environment.
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Frequently Asked Questions
What does a gold IRA look like?
People who wish to invest in precious metals can use Gold Ira accounts as a tax-free investment vehicle.
Physical gold bullion coin can be purchased at any time. You don't have a retirement date to invest in gold.
You can keep gold in an IRA forever. Your gold holdings will not be subject to tax when you are gone.
Your gold is passed to your heirs without capital gains tax. Your gold is not part of your estate and you don't have to include it in the final estate report.
To open a IRA for gold, you must first create an individual retirement plan (IRA). After you have done this, an IRA custodian will be assigned to you. This company acts in the role of a middleman between your IRS agent and you.
Your gold IRA custodian can handle all paperwork and submit necessary forms to IRS. This includes filing annual returns.
After you have established your gold IRA you will be able purchase gold bullion coin. The minimum deposit is $1,000. The minimum deposit is $1,000. However, you will receive a higher percentage of interest if your deposit is greater.
When you withdraw your gold from your IRA, you'll pay taxes on it. If you take out the whole amount, you'll be subject to income taxes as well as a 10 percent penalty.
Even if your contribution is small, you might not have to pay any taxes. However, there are exceptions. You'll owe federal income tax and a 20% penalty if you take out more than 30% of your total IRA assets.
You shouldn't take out more then 50% of your total IRA assets annually. You could end up with severe financial consequences.
What precious metals could you invest in to retire?
It is gold and silver that are the best precious metal investment. Both can be easily bought and sold, and have been around since forever. These are great options to diversify your portfolio.
Gold: This is the oldest form of currency that man has ever known. It's also very safe and stable. It's a great way to protect wealth in times of uncertainty.
Silver: Silver is a popular investment choice. This is a great choice for people who want to avoid volatility. Silver tends instead to go up than down, which is unlike gold.
Platinium: Platinum is another form of precious metal that's becoming increasingly popular. It's like silver or gold in that it is durable and resistant to corrosion. However, it's much more expensive than either of its counterparts.
Rhodium: The catalytic converters use Rhodium. It is also used to make jewelry. It is also very affordable in comparison to other types.
Palladium: Palladium, which is a form of platinum, is less common than platinum. It's also more affordable. It is a preferred choice among investors who are looking to add precious materials to their portfolios.
What are the pros & con's of a golden IRA?
An Individual Retirement account (IRA) is a better option than regular savings accounts in that interest earned is exempted from tax. An IRA is a good choice for those who want a way to save some money but don’t want the tax. However, there are disadvantages to this type investment.
If you withdraw too many funds from your IRA at once, you may lose all your accumulated assets. You may also be prohibited by the IRS from making withdrawals from an IRA after you turn 59 1/2. If you do withdraw funds from your IRA you will most likely be required to pay a penalty.
Another disadvantage is that you must pay fees to manage your IRA. Many banks charge between 0.5%-2.0% per year. Others charge management fees that range from $10 to $50 per month.
Insurance is necessary if you wish to keep your money safe from the banks. A majority of insurance companies require that you possess a minimum amount gold to be eligible for a claim. Insurance that covers losses upto $500,000.
If you choose to go with a gold IRA, you'll need to determine how much gold you want to use. You may be limited in the amount of gold you can have by some providers. Others let you choose your weight.
You will also have to decide whether to purchase futures or physical gold. The price of physical gold is higher than that of gold futures. Futures contracts allow you to buy gold with more flexibility. 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 provide coverage for damage from natural disasters, however. Additional coverage may be necessary if you reside in high-risk areas.
Additional to your insurance, you will need to consider how much it costs to store your gold. Storage costs will not be covered by insurance. Banks charge between $25 and $40 per month for safekeeping.
If you decide to open a gold IRA, you must first contact a qualified custodian. A custodian helps you keep track of your investments, and ensures compliance with federal regulations. Custodians can't sell assets. Instead, they must retain them for as long and as you require.
Once you've chosen the best type of IRA for you, you need to fill in paperwork describing your goals. Your plan should include information about the investments you want to make, such as stocks, bonds, mutual funds, or real estate. The plan should also include information about how much you are willing to invest each month.
After filling in the forms, please send them to the provider. The company will review your application and send you a confirmation letter.
You should consult a financial planner before opening a Gold IRA. A financial planner can help you decide the type of IRA that is right for your needs. They can also help you lower your expenses by finding cheaper alternatives to purchasing insurance.
Can I hold a gold ETF in a Roth IRA?
A 401(k) plan may not offer this option, but you should consider other options, such as an Individual Retirement Account (IRA).
An IRA traditional allows both employees and employers to contribute. A Employee Stock Ownership Plan, or ESOP, is another way to invest publicly traded companies.
An ESOP is a tax-saving tool because employees have a share of company stock as well as the profits that the business generates. The money invested in ESOPs is taxed at a lower rate that if it were owned directly by an employee.
A Individual Retirement Annuity is also possible. An IRA lets you make regular, income-generating payments to yourself over your life. Contributions to IRAs will not be taxed
Can the government take your gold
You own your gold and therefore the government cannot seize it. You have earned it by working hard for it. It belongs to you. However, there may be some exceptions to this rule. You can lose your gold if you have been convicted for fraud against the federal governments. Additionally, your precious metals may be forfeited if you owe the IRS taxes. However, if you do not pay your taxes, you can still keep your gold even though it is considered property of the United States Government.
Is gold buying a good retirement option?
While buying gold as an investment may seem unattractive at first glance it becomes worth the effort when you consider how much gold is consumed worldwide each year.
The most popular form of investing in gold is through physical bullion bars. However, there are many other ways to invest in gold. It's best to thoroughly research all options before you make a decision.
If you don’t need a safe place for your wealth, then buying shares of mining companies or companies that extract it might be a better alternative. If you need cash flow to finance your investment, then gold stocks could be a good option.
You can also invest your money in exchange-traded fund (ETFs), which give you exposure to the gold price by holding securities related to gold. These ETFs typically include stocks from gold miners, precious metallics refiners, commodity trading companies, and other commodities.
What is the benefit of a gold IRA?
Many benefits come with a gold IRA. It's an investment vehicle that lets you diversify your portfolio. You decide how much money you want to put into each account, and when you want it to be withdrawn.
You also have the option to roll over funds from other retirement accounts into a gold IRA. This makes for an easy transition if you decide to retire early.
The best part? You don’t need to have any special skills to invest into gold IRAs. They're readily available at almost all banks and brokerage firms. Withdrawals are made automatically without having to worry about fees or penalties.
However, there are still some drawbacks. The volatility of gold has been a hallmark of its history. It is important to understand why you are investing in gold. Is it for growth or safety? Is it for security or long-term planning? Only after you have this information will you make an informed decision.
If you plan on keeping your gold IRA alive for a while, you may want to consider purchasing more than 1 ounce of pure gold. A single ounce will not be sufficient to meet all your requirements. Depending on the purpose of your gold, you might need more than one ounce.
You don’t necessarily need a lot if you’re looking to sell your gold. Even a single ounce can suffice. These funds won't allow you to purchase anything else.
Statistics
- 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)
- 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)
- 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)
- Instead, the economy improved, stocks rebounded, and gold plunged, losing 28 percent of its value in 2013. (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
law.cornell.edu
- 7 U.S. Code SS7 – Designation of boards for trade as contract markets
- 26 U.S. Code SS 408 – Individual retirement funds
wsj.com
- Saddam Hussein’s InvasionHelped Uncage a Bear In 1989 – WSJ
- How do you keep your IRA Gold at Home? It's Not Exactly Lawful – WSJ
irs.gov
bbb.org
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. However, since there were no international standards for measuring gold at this point, different weights and measures existed worldwide. One pound sterling in England was equivalent to 24 carats silver, while one livre tournois in France was equal 25 carats. In Germany, one mark was equivalent to 28 carats.
In the 1860s, the United States began to issue American coins made from 90% copper, 10% Zinc, and 0.942 Fine Gold. 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. The U.S. government was unable to pay its debts due to too much money being in circulation. They sold some of their excess gold to Europe to pay off the debt.
Many European countries didn't trust the U.S. dollars and started to accept gold for payment. Many European countries began to use paper money and stopped accepting gold as payment after World War I. The gold price has gone up significantly in the years since. Even though the price fluctuates, gold is still one of best investments.
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By: Terence Zimwara
Title: Hong Kong Regulator Urges Crypto Investors to Use Approved Virtual Asset Trading Platforms
Sourced From: news.bitcoin.com/hong-kong-securities-regulator-issues-warning-to-unlicensed-virtual-asset-trading-platforms/
Published Date: Tue, 06 Feb 2024 11:30:34 +0000
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