New York Judge Hopes for Expedited SEC Decision on Celsius’ Repayment Proposal
During a court hearing on Monday, Judge Martin Glenn, who oversees the bankruptcy of Celsius, called on the U.S. Securities and Exchange Commission (SEC) to quickly decide whether it will authorize the company to transform itself into a crypto mining firm. The proposal aims to repay customers of the bankrupt cryptocurrency lender with both crypto assets and stock in a new publicly traded mining entity.
Glenn expressed his hope that the SEC will expedite the decision-making process due to Celsius and its creditors moving quickly through Chapter 11. He stated, "The SEC will make whatever decision it believes is the correct one. I just hope the process will move forward, so if there are any bumps in the road we can try and work those out along the way."
Repayment Proposal and Potential Liquidation
The plan is to partially repay customers who have had their accounts frozen since before the lender filed for bankruptcy in June 2022. This will be done using a combination of cryptocurrency and stock in the crypto mining entity. The new management team of the mining entity will be led by Arrington Capital, according to the report.
Glenn mentioned that he will issue a ruling as soon as possible, but the arrangement will still require approval from the securities regulator. If the plan to exit Chapter 11 through the proposed transformation into a new business fails, the crypto company may have to liquidate.
Challenges and Support
While the repayment proposal has received widespread support from creditors, some of Celsius' customers are challenging it. These customers prefer liquidation as they would receive more crypto assets rather than shares in a new firm that has yet to prove itself in the market. Additionally, some customers have expressed concerns about the fees paid to bankruptcy advisers who work to ensure creditor support for the plan.
SEC Lawsuit and Investor Concerns
In July of this year, the SEC sued Celsius, accusing the failed crypto lender and its former CEO Alexander "Alex" Mashinsky of making fraudulent promises for the platform's "Earn Interest Program" and misleading investors about the company's financial state. The agency also highlighted that investors were unable to withdraw billions of U.S. dollars in crypto assets when the business started to collapse.
The fate of Celsius Network's proposed transformation into a crypto mining firm now lies in the hands of the SEC. Judge Martin Glenn has urged the regulator to make a decision promptly, considering the progress made by Celsius and its creditors in the bankruptcy process. The repayment proposal, which has gained support from creditors, faces challenges from customers who prefer liquidation and have concerns about the fees involved. The SEC's decision will determine whether Celsius can move forward with its plans or face potential liquidation.
Frequently Asked Questions
How is gold taxed within an IRA?
The tax on the sale of gold is based on its fair market value when sold. Gold is not subject to tax when it's purchased. It isn't considered income. If you sell it later, you'll have a taxable gain if the price goes up.
Gold can be used as collateral for loans. Lenders will seek the highest return on your assets when you borrow against them. This often means selling gold. The lender might not do this. They might just hold onto it. They may decide to resell it. Either way, you lose potential profit.
In order to avoid losing your money, only lend against your precious metal if you plan to use it to secure other collateral. It's better to keep it alone.
What is a Precious Metal IRA and How Can You Benefit From It?
You can diversify your retirement savings by investing in precious metal IRAs. This allows you to invest in gold, silver and platinum as well as iridium, osmium and other rare metals. These are “precious metals” because they are hard to find, and therefore very 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.
A precious metal IRA lets you invest in bullion direct, instead of purchasing stock. This will ensure that you receive annual dividends.
Precious metal IRAs are not like regular IRAs. They don't need paperwork and don't have to be renewed annually. Instead, you pay a small percentage tax on the gains. Plus, you can access your funds whenever you like.
Should You Invest in gold for Retirement?
The answer will depend on how many dollars you have saved so far and whether you had gold as an investment option at the time. Consider investing in both.
You can earn potential returns on your investment of gold. This makes it a worthwhile choice for retirees.
Most investments have fixed returns, but gold's volatility is what makes it unique. As a result, its value changes over time.
However, it doesn't necessarily mean that you shouldn't invest your money in gold. It is important to consider the fluctuations when planning your portfolio.
Another benefit of gold is that it's a tangible asset. Gold is more convenient than bonds or stocks because it can be stored easily. It can be easily transported.
You can always access gold as long your place it safe. Physical gold is not subject to storage fees.
Investing in gold can help protect against inflation. Because gold prices tend to rise along with other commodities, it's a good way to hedge against rising costs.
Also, you'll reap the benefits of having some savings invested in something with a stable value. Gold usually rises when the stock market falls.
Another advantage to investing in gold is the ability to sell it whenever you wish. You can easily liquidate your investment, just as with stocks. You don't even need to wait for your retirement.
If you do decide to invest in gold, make sure to diversify your holdings. Don't put all your eggs on one basket.
Don't buy too many at once. Start by purchasing 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.
Although gold might not be the right investment for everyone it could make a great addition in any retirement plan.
- Instead, the economy improved, stocks rebounded, and gold plunged, losing 28 percent of its value in 2013. (aarp.org)
- 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)
- If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (lendedu.com)
- (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)
- 7 U.S. Code SS7 – Designation Boards of Trade as Contract Markets
- 26 U.S. Code SS 408 – Individual retirement accounts
The growing trend of gold IRAs
Investors are increasingly turning to gold IRAs as a way to diversify and protect their portfolios from inflation.
The gold IRA allows owners to invest in physical gold bullion and bars. It is tax-free and can be used by investors who aren't concerned about stocks and bond.
Investors also enjoy the benefits of owning physical gold, which includes its unique properties such as durability, portability, and divisibility.
A gold IRA provides many additional benefits. One is the ability for heirs to quickly transfer ownership of gold. Another is the fact that gold is not considered a currency or a commodities by the IRS.
Investors looking for financial security are increasingly turning to the gold IRA.
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