A Resilient Year for USDC Amidst Market Shifts
A recent report from Circle, the issuer of USD Coin (USDC), reveals that despite facing challenges in 2023, USDC has proven to be resilient. The stablecoin has experienced a surge in real-world applications and a decrease in speculative trading.
2023 posed several challenges for USDC. The circulating supply of the stablecoin, which is pegged to the U.S. dollar and backed by liquid cash and cash-equivalent assets, witnessed a significant decline from $45 billion to $25 billion. This decline, amounting to a 44% reduction, can be attributed to a shift of assets from the crypto ecosystem to traditional markets. This shift was driven by rising interest rates, regulatory pressures, industry bankruptcies, and fraud incidents.
Despite the decline in circulating supply, the number of wallets holding at least $10 of USDC increased by 59%, reaching over 2.7 million. This growth is noteworthy considering the overall contraction in the crypto sector. It indicates a strong vote of confidence in USDC as a bridge between the crypto asset economy and traditional finance. Throughout the year, over $197 billion worth of USDC was issued or burned.
Surge in USDC Usage for Remittances and Trade Finance
The Asia-Pacific region has witnessed a remarkable surge in the usage of USDC for remittances, with $130 billion flowing into the region in 2022. Circle's strategic efforts in this region, including a partnership with Coins.ph, a Philippines-based exchange, have specifically targeted the $36 billion remittance market. Furthermore, the report highlights USDC's role in addressing the $510 billion trade finance gap in emerging markets.
Notably, the report also emphasizes the increasing practical use of USDC, particularly for remittances and trade finance. In contrast, the role of USDC in speculative trading has declined significantly, witnessing a 90% decrease over the past five years.
What stablecoin do you prefer? Share your thoughts and opinions on this subject in the comments section below.
Frequently Asked Questions
What is the Performance of Gold as an Investment?
The price of gold fluctuates based on supply and demand. It is also affected by interest rates.
Due to the limited supply of gold, prices for gold are highly volatile. There is also a risk in owning gold, as you must store it somewhere.
How much should I contribute to my Roth IRA account?
Roth IRAs can be used to save taxes on your retirement funds. The account cannot be withdrawn from until you are 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. If you take out more than the initial contribution, you must pay tax.
The second rule states that income taxes must be paid before you can withdraw earnings. You will pay income taxes when you withdraw your earnings. 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. Federal income taxes would apply to the earnings. You would be responsible for $3500 This leaves you with $6,500 remaining. Since you're limited to taking out only what you initially contributed, that's all you could take out.
If you took $4,000 from your earnings, you would still owe taxes for the $1,500 remaining. You'd also lose half the earnings that you took out, as they would be subject to a second 50% tax (half of 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. A traditional IRA allows for you to deduct pretax contributions of your taxable income. You can withdraw your contributions plus interest from your traditional IRA when you retire. There are no restrictions on the amount you can withdraw from a Traditional IRA.
Roth IRAs won't let you deduct your contributions. You can withdraw your entire contribution, plus accrued interests, after you retire. There is no minimum withdrawal limit, unlike traditional IRAs. You don’t have to wait for your turn 70 1/2 years before you can withdraw your contributions.
How is gold taxed within a 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.
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.
The rules that govern these accounts differ from one state to the next. For example, in Maryland, you must take withdrawals within 60 days after reaching age 59 1/2 . Massachusetts allows you to delay withdrawals 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.
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)
- If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (lendedu.com)
- This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (smartasset.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)
External Links
forbes.com
- Gold IRA, Add Sparkle to Your Retirement Nest egg
- Understanding China's Evergrande Crisis – Forbes Advisor
wsj.com
- Saddam Hussein's Invasion Helped Uncage a Bear In 1990 – WSJ
- Do you want to keep your IRA gold at home? It's Not Exactly Legal – WSJ
bbb.org
irs.gov
How To
The History of Gold as an Asset
From the very beginning of time, gold was a currency. It was popular because of its purity, divisibility. uniformity. scarcity and beauty. In addition, because of its value, it was traded internationally. Because there were no internationally recognized standards for measuring and weighing gold, the different weights of this metal could be used worldwide. One pound sterling, for example, was equivalent in England to 24 carats, and one livre tournois, in France, to 25 carats. A mark, on the other hand, was equivalent in Germany to 28 carats.
The United States started issuing American coins in the 1860s made of 90% copper and 10% zinc. 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. Because the U.S. government had too much money coming into circulation, they needed to find a way to pay off some debt. They decided to sell some excess gold to Europe in order to do this.
Many European countries didn't trust the U.S. dollars and started to accept gold for payment. However, many European nations stopped using gold to pay after World War I and started using paper currency instead. The price of gold rose significantly over the years. Even though the price fluctuates, gold is still one of best investments.
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By: David Sencil
Title: USDC Navigates Challenging Waters in 2023: Circle Report
Sourced From: news.bitcoin.com/circle-report-shows-usdc-navigating-challenging-waters-in-2023/
Published Date: Wed, 17 Jan 2024 11:00:11 +0000
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