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US authorities warn people against crypto exposure in IRAs

US authorities warn people against crypto exposure in IRAs 2

The financial Watchdogs in the US raised concerns over the crypto exposure in some IRAs citing a very big risk to the retirement fund portfolio.

In every Crypto bull run, many people appeared as new millionaires. Mainly Bitcoin & Ethereum like crypto assets dragged some individual retirement accounts (IRAs) services providers. In particular, we can see the proposal from Fidelity Investments, which decided to bring Bitcoin & Ethereum in 401(k) accounts, a savings account service for the US-based companies’ employees. 

On 7 Feb 2023, The United States Securities and Exchange Commission’s Office of Investor Education and Advocacy, the North American Securities Administrators Association, and the Financial Industry Regulatory Authority released a report on the increasing inflow of crypto assets in IRAs. 

The US Authority noted that some IRAs include Crypto assets investment, which is very risky because of the highly volatile nature of the price of crypto assets. 

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Secondly, they noted that investment in such assets may be subject to the Securities Act but still many IRAs are considering crypto assets investment without any registration with the SEC agency.

Earlier this In Nov 2022, New York Attorney General Letitia James raised questions over the involvement of crypto assets in IRAs and suggested ways to prevent crypto investment. 

No doubt that many regulators & lawmakers raised their voices against crypto investment in retirement accounts but still many big govt level personalities supported Bitcoin.

The US senator Cynthia Lummis from Wyoming said that she likes the idea of Bitcoin in 401(k).  Cynthia talked about Bitcoin many times. In 2021, Cynthia suggested people have Bitcoin in portfolio and also she confirmed that she is a Bitcoin holder. 

Read also: WazirX exchange says Binance allegations are fake

US authorities warn people against crypto exposure in IRAs

 

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