Introduction
The crypto community is buzzing with excitement this week as Blast, a new Ethereum layer two (L2) platform, emerges into the spotlight. With a notable $20 million in funding secured from investors like Paradigm and Standard Crypto, Blast is gaining prominence in the industry. Developed by Pacman, the entrepreneur behind the popular non-fungible token (NFT) marketplace Blur, Blast has already locked up over $400 million in digital assets within just one week. However, the platform's mechanics have come under intense scrutiny.
Blast: Ethereum's L2 Newcomer
On November 20, 2023, Tieshun Roquerre, also known as Pacman, unveiled Blast after receiving funding from Standard Crypto, Paradigm, and other investors. Blast differentiates itself as an Ethereum L2 network by offering native yields for ethereum (ETH), staked ethereum (STETH), and stablecoins like DAI, USDT, and USDC. This unique feature sets it apart from other L2 solutions in the market.
Rapid Lockup and Invite-Only Access
In less than a week, Blast has locked up an impressive $405 million in value, despite currently being an invite-only platform. Although some social media users are sharing Blast invite codes, it's important to note that users cannot bridge out or withdraw funds until February 2024.
The platform's referral system and emissions mechanics have led some to label it as a "pyramid scheme" and a "Ponzi." David Attermann, co-founder and managing partner at Omnichain Capital, expressed his concerns, stating that it's an "awful look" for the investors and influencers involved.
The Team Behind Blast
Blast boasts a talented team, which includes Pacman and alumni from prestigious institutions such as MIT, Yale, and Nanyang Technological University. Additionally, the team comprises experts from FAANG and Seoul National University. The platform's referral system features a leaderboard that ranks members based on the points they earn for bridging assets and inviting friends.
Airdrop and Distribution
Blast is also preparing for an airdrop, with distribution evenly split between early access members (50%) and developers (50%), as stated on their website. The early access phase is currently active, and developers are set to receive their share of the airdrop in January, coinciding with the launch of the Blast Testnet. However, early access participants will have to wait until May for their airdrop.
Despite skepticism surrounding Blast, similar to the early days of Blur, the project is gaining significant traction. It is being closely observed on analytics platforms and explorers such as Arkham Intelligence, Dune Analytics, and Defillama.
Security Concerns and Nuanced Approach
There are discussions and public disapproval regarding Blast's multi-signature mechanism tied to the vault. In response, Blast published an X post on Friday, emphasizing the nuanced and spectrum-based nature of security. The startup believes that upgradeable contracts, despite perceived vulnerabilities, especially in token-gated, time-locked mechanisms, can offer enhanced security in specific scenarios.
Share Your Thoughts
What are your thoughts on Blast's rapid rise and the criticism it has faced? We invite you to share your opinions and insights in the comments section below.
Frequently Asked Questions
Is it a good retirement strategy to buy gold?
Although it may not look appealing at first, buying gold for investment is worth considering when you consider the global average gold consumption per year.
Physical bullion is the most popular method of investing in gold. There are other ways to invest gold. The best thing to do is research all options thoroughly and then make an informed decision based on what you want from your investments.
If you don't want to keep your wealth safe, buying shares in companies that extract gold and mining equipment could be a better choice. If you need cash flow from an investment, purchasing gold stocks is a good choice.
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.
What is the value of a gold IRA
A gold IRA has many benefits. It's an investment vehicle that lets you diversify your portfolio. You can control how much money is deposited into each account as well as when it's withdrawn.
You can also rollover funds from other retirement accounts to a gold IRA. If you are planning to retire early, this makes it easy to transition.
The best thing about investing in gold IRAs is that you don’t need any special skills. They are offered by most banks and brokerage companies. Withdrawals can happen automatically, without any fees or penalties.
However, there are still some drawbacks. The volatility of gold has been a hallmark of its history. Understanding why you want to invest in gold is essential. Are you looking for growth or safety? Is it for insurance purposes or a long-term strategy? Only when you are clear about the facts will you be able take 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. You won't need to buy more than one ounce of gold to cover all your needs. You could need several ounces depending on what you plan to do with your gold.
You don't have to buy a lot of gold if your goal is to sell it. Even one ounce is enough. These funds won't allow you to purchase anything else.
What are the fees associated with an IRA for gold?
A monthly fee of $6 for an Individual Retirement Account is charged. This includes account maintenance fees and investment costs for your chosen investments.
If you want to diversify, you may be required to pay extra fees. The fees you pay will vary depending on the type of IRA that you choose. Some companies offer free checking, but charge monthly fees for IRAs.
In addition, most providers charge annual management fees. These fees range from 0% to 1%. The average rate is.25% annually. However, these rates are typically waived if you use a broker like TD Ameritrade.
Should You Invest in Gold for Retirement?
It depends on how much you have saved and if gold was available at the time you started saving. If you're unsure about which option to choose then consider investing in both.
You can earn potential returns on your investment of gold. This makes it a worthwhile choice for retirees.
Gold is more volatile than most other investments. Therefore, its value is subject to change over time.
But this doesn't mean you shouldn't invest in gold. It just means that you need to factor in fluctuations to your overall portfolio.
Another advantage to gold is that it can be used as a tangible asset. Gold can be stored more easily than stocks and bonds. It is also easily portable.
You can always access your gold as long as it is kept safe. Plus, there are no storage fees associated with holding physical gold.
Investing in gold can help protect against inflation. It's a great way to hedge against rising prices, as gold prices tend to increase along with other commodities.
A portion of your savings can be invested in something that doesn't go down in value. Gold rises in the face of a falling stock market.
Gold investment has another advantage: You can sell it anytime. You can also liquidate your gold position at any time you need cash, just like stocks. It doesn't matter if you are retiring.
If you do decide to invest in gold, make sure to diversify your holdings. Don't put all of your eggs in one basket.
Don't buy too many at once. Start small, buying only a few ounces. Then add more as needed.
Keep in mind that the goal is not to quickly become wealthy. Instead, the goal here is to build enough wealth to not need to rely upon Social Security benefits.
While gold may not be the best investment, it can be a great addition to any retirement plan.
How to open a Precious Metal IRA
The first step is to decide if you want an Individual Retirement Account (IRA). To open the account, complete Form 8606. To determine which type of IRA you qualify for, you will need to fill out 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 contribute directly to your paycheck via payroll deduction.
You must complete Form 8903 if you choose a Roth IRA. The process for an ordinary IRA will not be affected.
To qualify for a precious-metals IRA, you'll need to meet some requirements. You must be at least 18 years of age and have earned income to qualify for a precious metals IRA. For any tax year, your earnings must not exceed $110,000 ($220,000 for married filing jointly). Contributions must be made regularly. These rules apply regardless of whether you are contributing directly to your paychecks or through your employer.
You can invest in precious metals IRAs to buy gold, palladium and platinum. However, physical bullion will not be available for purchase. This means you can't trade shares of stock and bonds.
You can also use your precious metals IRA to invest directly in companies that deal in precious metals. This option is offered by some IRA providers.
There are two major drawbacks to investing via an IRA in precious metals. First, they aren't as liquid than stocks and bonds. It's also more difficult to sell them when they are needed. They also don't pay dividends, like stocks and bonds. So, you'll lose money over time rather than gain it.
How much gold do you need in your portfolio?
The amount that you want to invest will dictate how much money it takes. You can start small by investing $5k-10k. Then as you grow, you could move into an office space and rent out desks, etc. So you don't have all the hassle of paying rent. It's only one monthly payment.
It is also important to decide what kind of business you want to run. In my case, I run a website-creation company. Our clients pay us between $1000-2000/month and depending on their order. If you are doing this type of thing, it is important to think about how much you can expect from each client.
If you are doing freelance work, you probably won't have a monthly salary like I do because the project pays freelancers. This means that you may only be paid 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.
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)
- You can only purchase gold bars at least 99.5% purity. (forbes.com)
- Gold is considered a collectible, and profits from a sale are taxed at a maximum rate of 28 percent. (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)
- Instead, the economy improved, stocks rebounded, and gold plunged, losing 28 percent of its value in 2013. (aarp.org)
External Links
irs.gov
law.cornell.edu
- 7 U.S. Code SS7 – Designation board of trade as contract marketplaces
- 26 U.S. Code SS 408 – Individual retirement plans
finance.yahoo.com
bbb.org
How To
Guidelines for Gold Roth IRA
Starting early is the best way to save for retirement. Start saving as soon as possible, usually at age 50. You can continue to save throughout your career. It's vital to contribute enough money each year to ensure adequate growth on an ongoing basis.
You may also wish to take advantage of tax-free investments such as a SIMPLE IRA, SEP IRA, and traditional 401(k). These savings vehicles permit you to make contributions, but not pay any tax until your earnings are withdrawn. This makes them great options for people who don't have access to employer matching funds.
It's important to save regularly and over time. If you aren't contributing the maximum amount permitted, you could miss out on tax benefits.
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