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Cryptocurrency Retirement Funds | SEC Warns Against Crypto IRAs

If you were planning on using Bitcoin to retire, you might want to think again. Why? Well, because the SEC has recently warned against cryptocurrency retirement funds.

Here’s why.

Cryptocurrency Retirement Funds

As people approach retirement, many are nervous about where they are sitting financially. For these reasons, people are turning to self-directed IRAs, which are savings accounts that allow for alternative investments.

When it comes to self-directed IRAs, typical investments include company stocks and precious metals. However, thanks to the crypto boom, virtual currencies have been added as an option.

But the SEC doesn’t appear to support the addition. According to the commission, just because people can use their retirement funds to invest in cryptocurrencies doesn’t mean they should. There are still a number of risks.

What Did the SEC Say?

The Office of Investor Education, which is a branch of the SEC, issued an investor alert this month. It said the attraction of virtual assets has the potential to be used by fraudsters.

Specifically, the SEC said that now that there are cryptocurrency retirement funds, it’s important to know about the risks and “fraud involved with these kinds of investments that may not be registered.”

Fraud, Fraud, and More Fraud

Are we surprised to see that the SEC is warning investors of the potential for crypto fraud? I’m certainly not. It’s perhaps one of the most common arguments against cryptocurrencies.

It’s not solely to do with cryptocurrency retirement funds, either. Whether you’re crypto investing or crypto trading, there is always going to be the possibility of fraud and crypto scams.

The Takeaway

It’s not as if the SEC made retirement funds investing in cryptocurrencies illegal (like Saudi Arabia has done with crypto trading), so at the end of the day, it’s up to the individual whether they want to continue or not.

That said, bear in mind what the Office of Investor Education said this month.

Stay alert, find a good custodian, understand the rules of self-directed IRAs, and do your homework before giving the green light for an investment!

>> TRON (TRX), IOTA (MIOTA), and Ethereum (ETH) Lose Big

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Investing in Cryptocurrency | Explaining Cryptocurrencies

Cryptocurrency has become worldwide famous among the people. Many believe that investing in cryptocurrency will generate more revenue this year.

Many people have internet access today, which is one of the reasons why investing in cryptocurrency is increasing day by day.

Virtual Coins

Virtual coins are known as a dispersing electronic form of currency that does not have any presence in physical form. Virtual coins are a specific form of digital currency/money that uses an encryption method to make the transaction secure and control forming new units.

Cryptocurrency such as digitals coins has caused financial chaos and is a collective agreement of each computer on a virtual coin network. Each and every transaction done by using cryptocurrency technology should be 100 percent secure and private through the digital key.

Below are the options available if you want to own a virtual coin:

  • All virtual coins are made through complex mathematical equations that are inspected by many users, known as ‘Miners.’ A miner is involved in investing lots of money in computers. The value might be larger than the value of the virtual coins being earned.
  • Another option is simply buying a virtual coin from someone else, generally through a cryptocurrency exchange platform.

How Cryptocurrency Works

Cryptocurrency is a virtual currency that can be bought or earned. These virtual currencies are issued and managed as per the predefined methods that are very specific to every cryptocurrency. New virtual coins are issued via a mining algorithm, which is provided by a miner. In exchange for their service, miners are given the awards of virtual currency units. Hence, the individual who wishes to own the virtual coin without taking part in the activities called mining should buy them.

Cryptocurrency Keys

There are two types of cryptocurrency keys:

Public Key: This is the confirmation of existence and unique identity of the virtual currency units.

Private Key: This is like a secret code that is recorded in a digitized wallet. People can purchase goods and services and can even invest or transfer the digital currency. However, to do so, they need to set up a digital wallet by using distinct software that is specially designed for a cryptocurrency trading platform. These transactions are pseudo-unknown thanks to the private key.

The person who owns a virtual currency can check their currency units by using the private key while making a payment. The process goes on, and transactions are submitted to a network of miners that confirms the ownership of that virtual currency unit and validates it then passes it to the new owner.

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Cryptocurrency—Functioning as Money

Cryptocurrencies may one day be able to function as regular money.

  • Recognition of cryptocurrencies is very limited, but with greater recognition, the greater the chance of cryptocurrencies functioning as money.
  • Two different parties might go through the transactions and another medium.
  • Digital currencies are a very valuable asset. They are kept under a digital wallet system; however, this system can have high maintenance costs and can be prone to hacks.

Buying Your First Virtual Coin

Buying virtual coins can be a confusing process for many, but more and more people these days are investing in cryptocurrency. Cryptocurrency exchanges and trading platforms are built to create smart contracts that run in a programmable manner, and there is no space for fraud, censorship, or any kind of third-party interference.

Once you’ve created an account on your chosen trading platform, the payment method options can be added, including debit cards, credit cards, etc.

Benefits of Cryptocurrency

Below are the main advantages of virtual currency:

  1. It is similar to precious metals and provides protection against inflation.
  2. It gives reliable means of exchange that are attractive among the people.
  3. Virtual currency transactions cost less compared to other traditional electronic transactions.
  4. Transactions are often free or come with low fees.
  5. The location of sender and recipient does not matter.

The Bottom Line!

Virtual coins are leading the pack of cryptocurrency with due respect of market capitalization, popularity, and user base. Investing in cryptocurrency is becoming more popular day by day, and many virtual currencies are now used for enterprise solutions.

Cryptocurrencies can act as a valuable asset and are becoming an accepted payment method worldwide.

>> Square Cash App Expands to All 50 US States and Allows All Members to Buy Bitcoin (BTC)

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Crypto Trading Through Algocratization | Making Crypto Accessible

Cryptocurrency trading has always been fundamentally different from traditional finance in lots of ways.

It’s more inclusive, easier to make big and quick gains, has lower barriers to entry, and doesn’t require huge startup costs.

Maybe these are the reasons why crypto has been so fiercely and constantly undermined by the elitist financial class ever since it’s been big enough to catch their attention.

Crypto represents a marketplace where you don’t have to be a millionaire to get started and achieve huge success.

This article tells the story of a man who started with an investment of just $3,000 and made enough money to retire and travel the world in enormous luxury forever.

This market has the potential to redefine the way we think about trading. But even so, it isn’t as equal as it could be. There are still many opportunities for the wealthy and well-connected to secure big advantages.

That means there’s still some work to be done. It’s important to preserve crypto’s values, make things fairer, and ensure that newcomers to crypto aren’t excluded because they don’t have enough money or influence.

First up, let’s take a look at why less established traders might be finding it harder to break into crypto.

 

Excluded from Tech by Tech

One of the biggest things preventing ordinary traders from having real success with crypto is algorithms. More specifically, how difficult good trading algorithms are to build and access.

In traditional, Wall Street finance, algorithms are a staple of the profession. They’re widely used by trading firms and those in the know because they bring massive advantages to the table.

Algorithms take care of the mundane, repetitive parts of trading, the bits humans can’t stand. They can monitor the markets constantly, buy or sell stock when the price reaches a certain point, and easily automate a lot of the necessary but monotonous elements of finance.

They also help reduce the risk of human error. People are famously prone to making big mistakes when it comes to trading. Fear, anxiety, and impulsivity can drive otherwise cool-headed traders to make disastrous blunders costing enormous sums of money. That doesn’t exist with AI.

And in cryptocurrency trading, algorithms are even more useful. That’s because the crypto markets operate on a 24/7 basis, meaning it’s literally impossible for a single human to monitor them effectively.

To make matters worse, cryptocurrencies are also notoriously volatile. Big crashes or staggering growth can happen pretty much overnight, and it’s easy for a person to miss out on danger and opportunity alike.

So for the beginner crypto trader, algorithms are a really important piece of the puzzle. Not having access to this technology puts you at a disadvantage from the offset.

So why isn’t every crypto trader using them? The answer is simple: cost. Unless you have the coding skill to put together your own algorithm, you’re forced to pay someone else to do it for you, and that kind of service doesn’t come cheap.

As always, it’s the wealthy and the well-connected that come out on top, while ordinary traders are left trailing and unable to make use of this valuable weapon.

In order to make crypto more accessible and allow anyone to have a good chance of success regardless of their wealth or status, we need to make algorithms much more easily available. The good news is that several companies are doing just that.

 

Algorithms for Everyone

Among the companies trying to make algorithms more accessible is Capitalise.

Through their platform where users can build their own algorithms affordably and easily without any coding knowledge required.

In the Algobuilder platform, users simply type instructions in plain English and the interface takes care of the rest. It even gives suggestions and guides users through popular steps to help build a typically effective algorithm.

Crypto Trading Through Algocratization

If you manage to create a successful model, you’ll be able to share it with other users in the network. Capitalise even want to build a kind of social network, where traders will be able to help one another and draw on each other’s expertise.

Projects like this represent a more equal, community-minded approach to crypto trading, where users are encouraged to support each other. It’s a push towards a more inclusive crypto trading market, where participation isn’t restricted to wealthy and established traders.

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Are Bitcoin and Ethereum Playing You Dirty? – Crypto Currency News

There has been a criminal probe into the possibility of crypto price manipulation by the traders of Bitcoin and Ethereum opened up by the United States. It has been reported that the Department of Justice is looking into activity surrounding these two cryptocurrencies. Commodity Futures Trading Commission and other federal prosecutors will look into the evidence to see if any traders in these two markets have manipulated prices through spoofing or wash trading.

Crypto Price Manipulation?

As with anything that can be traded, cryptocurrency prices depend on many factors. One of these is the positive or negative feelings of the market and the individual investors making trades within it. While this sense of movement, and the potential of a particular crypto coin, can be hard to quantify, it is something that experienced investors pay close attention to.

Because the impact of those feelings, positive or negative, also have a significant effect on the marketplace and the tendencies of cryptocurrency investors to buy or sell their coins, these factors are crucial to the value of the crypto coins even if those factors are often hard to identify.

The very fact that those positive and negative feelings are elusive is what makes spoofing possible. Traders who want to manipulate a given market create illusions of optimism if they’re going to increase the valuation of a crypto coin, and create the illusion of pessimism when they want to drive the price down. To do this, the traders will generate orders without any intention of filling them. This tricks legitimate investors into buying or selling, and the price of the crypto coins suddenly are in jeopardy of being adjusted. Once the adjustment happens, the bogus traders then cancel their orders. Spoofing is the very reason that the US Department of Justice has opened an investigation into Bitcoin to determine if manipulation has occurred.

Wash trading is something that happens when a trader buys their own orders. This, once again, gives the appearance of trading activity that just isn’t happening. These trades are only used to manipulate markets and encourage other investors to buy, buy, and buy. In these types of trades, there is no market risk for the manipulator, who only stands to gain from his or her bogus activity.

The Securities and Exchange Commission started its investigation back in March. However, many companies involved in crypto, like tZero, which is a subsidiary of the Bitcoin-friendly Overstock.com, fell under the radar of this investigation, which begs one to wonder what good the inquiry will do. Soon after that began the United States and Canada started something called Operation Crypto Sweep, which is a joint effort to root out fraud in the world of crypto. But with the current state of affairs between these two nations getting sour by the hour, who knows if this will even have any impact.

What we do know is that with governments now getting involved in crypto one can see the possibility of centralized regulatory bodies coming into play with regulation. This would defeat the whole purpose of having a decentralized monetary system free of such regulation, and the possibility of a few ruining it all for the many could at this moment be happening. We will simply have to wait it out, and see where this all ends up.

Do you think there’s been crypto price manipulation?

>> The Top 15 Cryptocurrency Influencers of 2018

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