Is a ban on Retirees Cypto Account a fair deal?

[Zilon]

New York Attorney General Letitia James in the bid to protect retirees from the dangers of investing in Crypto currencies, digital assets, digital tokens and digital coins has egged on  Congress to pass a law prohibiting crypto investments in retirement accounts.

Her point of concern is on the Individual retirement accounts(IRAs) and defined contribution plans, like 410(K0 plans and 457 plans for government workers, which has been the investment option for millions of Hardworking Americans after retirement. She sighted the recent development in financial institution where Bitcoin became an investment option in 410(k) plans, and other financial institutions expected to follow suit. With the recent downtimes in the crypto market and the market turbulence, Attorney General James  emphasised on the protection of workers' retirement funds and save them from the risk associated with cryptocurrencies.

Most of this retirees know absolutely nothing about how this digital assets work. The just trust this investment plans to make the right decision for them. Attorney General James is only been protective of her citizens to save them from the downtimes because the only depend on pensions for survival as such risking them on assets the can't control themselves can result to sudden death and heart failures. Because they will have to wait till the market becomes favourable to start making profit on their investments.

link

[South Park]

New York Attorney General Letitia James in the bid to protect retirees from the dangers of investing in Crypto currencies, digital assets, digital tokens and digital coins has egged on  Congress to pass a law prohibiting crypto investments in retirement accounts.

Her point of concern is on the Individual retirement accounts(IRAs) and defined contribution plans, like 410(K0 plans and 457 plans for government workers, which has been the investment option for millions of Hardworking Americans after retirement. She sighted the recent development in financial institution where Bitcoin became an investment option in 410(k) plans, and other financial institutions expected to follow suit. With the recent downtimes in the crypto market and the market turbulence, Attorney General James  emphasised on the protection of workers' retirement funds and save them from the risk associated with cryptocurrencies.

Most of this retirees know absolutely nothing about how this digital assets work. The just trust this investment plans to make the right decision for them. Attorney General James is only been protective of her citizens to save them from the downtimes because the only depend on pensions for survival as such risky them on assets the can't control themselves can result to sudden death and heart failures.

I have always thought that the management of retirement accounts should be very conservative as any significant loss could take years to recover, and if you are at the end of your career or you simply cannot work anymore then you are never getting that money back, so in principle I am not against the ban, however if they are banning bitcoin and other crypto then I hope they do the same with the many other financial instruments which are also very risky as a way to protect the retirement funds of workers.

[Captain Corporate]

This is a simple attack on liberalism and freedom. If the retiree has their sanity intact and can easily say that they want their funds to be turned fully into Shiba or any other shitcoin then they can, it's their own choice. It doesn't matter if it is a good decision or not, that is not the point of this, it is about being able to do what you want with your money. They are not doing anything illegal that hurts other people either, it's their own money and if they want to buy bitcoin with it then they can do it and nobody should be able to stop them. To say "its dangerous, we shouldn't allow them" is a breach of their freedom.

[avikz]

New York Attorney General Letitia James in the bid to protect retirees from the dangers of investing in Crypto currencies, digital assets, digital tokens and digital coins has egged on  Congress to pass a law prohibiting crypto investments in retirement accounts.

Her point of concern is on the Individual retirement accounts(IRAs) and defined contribution plans, like 410(K0 plans and 457 plans for government workers, which has been the investment option for millions of Hardworking Americans after retirement. She sighted the recent development in financial institution where Bitcoin became an investment option in 410(k) plans, and other financial institutions expected to follow suit. With the recent downtimes in the crypto market and the market turbulence, Attorney General James  emphasised on the protection of workers' retirement funds and save them from the risk associated with cryptocurrencies.

Most of this retirees know absolutely nothing about how this digital assets work. The just trust this investment plans to make the right decision for them. Attorney General James is only been protective of her citizens to save them from the downtimes because the only depend on pensions for survival as such risking them on assets the can't control themselves can result to sudden death and heart failures. Because they will have to wait till the market becomes favourable to start making profit on their investments.

link

I would say it is a sane approach toward the safety and security of the funds! Retirement funds are different than any other form of investment. It has to be safe yet must provide a market-linked return. So I would support this cause!

Crypto assets are extremely volatile in nature. Young people who have time in hand, can surely invest in cryptos if they are able to get in and get out at a right time. That's the basis of crypto investment. Investors need to be extremely agile in nature. Retirement funds are usually not handled this way. So it's a very high-risk investment for retirement funds. 

Recently, news came out of Canada related to 95 million dollars of loss from FTX collapse. Crypto market has already seen a lot of collapses considering it is a relatively new type of investment. So it's better to keep for those people whose risk appetite is high.

Read here: https://www.reuters.com/technology/ontario-pension-says-any-loss-ftx-investment-have-limited-impact-2022-11-10/

[franky1]

if the ban is approved.. then no chance of a ETF or institutional level investments

because pension portfolios invest in literally all things stocks, bonds, shares, commodities..
so banning crypto from those markets as a "product" institutional level portfolio managers cant invest in. means bitcoin remains on the fringes and not mainstreamed.

this latest round of backlash is not about the bitcoin price volatility. its actually sparked by the investment in COMPANIES that manage crypto assets, where things like ETF is unregulated and so not protected by any government financial insurance system

the real solution is not to ban it.
but to ban then licence/permit it. meaning that to get a licence/permit to offer a product to investment plans, financial businesses offering crypto backed collateral products like an ETF share has to meet certain regulations..

[Zlantann]

Is a ban on Retirees Cypto Account a fair deal?

I think it is important for every pensioners to know the areas that his pension savings is invested. Pension fund administrators should be able to educate their clients about their investment platforms and give them the opportunity to choose the sectors they want their funds to be invested. If the pension managers are investing in cryptocurrencies then these pensioners should be able to understand the risk that is involved and they should be given the privilege to choose if they want their funds to be invested in cryptocurrencies or not.

An outright ban is not the solution because the crypto space is very profitable sector. These retirees fund managers can genuinely make money from Bitcoin since pension is a long time investment. Considering the problems that some reputable exchanges are going through currently, there is need to supervise or regulate the activities of this pension managers. The government should enact sound policies to discourage them or bar from investing in some of these crypto Ponzi and get-rich-quick schemes. Some of these pension managers engage in reckless and risky crypto investment without considering the consequences. 
       

[Fortify]

New York Attorney General Letitia James in the bid to protect retirees from the dangers of investing in Crypto currencies, digital assets, digital tokens and digital coins has egged on  Congress to pass a law prohibiting crypto investments in retirement accounts.

Her point of concern is on the Individual retirement accounts(IRAs) and defined contribution plans, like 410(K0 plans and 457 plans for government workers, which has been the investment option for millions of Hardworking Americans after retirement. She sighted the recent development in financial institution where Bitcoin became an investment option in 410(k) plans, and other financial institutions expected to follow suit. With the recent downtimes in the crypto market and the market turbulence, Attorney General James  emphasised on the protection of workers' retirement funds and save them from the risk associated with cryptocurrencies.

Most of this retirees know absolutely nothing about how this digital assets work. The just trust this investment plans to make the right decision for them. Attorney General James is only been protective of her citizens to save them from the downtimes because the only depend on pensions for survival as such risking them on assets the can't control themselves can result to sudden death and heart failures. Because they will have to wait till the market becomes favourable to start making profit on their investments.

In the current world we live in, where phone scams are prevalent and the oldest generations are still extremely unsavvy when it comes to the internet, you have to fairly judge whether directing them into such investments is a wise decision. Traditionally as people enter retirement they should be in a position where their portfolio is almost entirely derisked - put into low paying but steady government bonds of the most reliable nature. Crypto however is the extreme opposition end of the "investment" spectrum and it makes sense to put some added protections in place to somewhat try and protect people from their own poor financial practices. It should not be banned entirely, but only very knowledgeble buyers should be in this space.

[Smartvirus]

New York Attorney General Letitia James in the bid to protect retirees from the dangers of investing in Crypto currencies, digital assets, digital tokens and digital coins has egged on  Congress to pass a law prohibiting crypto investments in retirement accounts.

Just like the scammers we have leveraging the crypto space, this is a page out of there play book in a bid to protect them. It might seem unfair or should I say unfair as, they aren't given the chance to make investment decisions with there hard earned money, the motive isn't exactly out of place as it will protect them from scamees that tends to pry on the old, the emotionally unstable and ignorant minds of what is out there.  I can't really rule on this although, the better part of me tells me it isn't right but I think I can see the reason even though it isn't justified.

[Hydrogen]

New York Attorney General Letitia James in the bid to protect retirees from the dangers of investing in Crypto currencies, digital assets, digital tokens and digital coins has egged on  Congress to pass a law prohibiting crypto investments in retirement accounts.

A poll in april of 2022 found 59% of new york residents believe they and their families would be better off if they left the state:

Get outta town: Why majority of New Yorkers would rather be anywhere else

With violent crime on the rise and showing no signs of a letup, a majority of voters said their family would be better off if they fled New York City, a new survey reveals.

The poll, released Wednesday by Fontas Advisors/Core Decision Analytics, presented voters with this statement: “My family would have a better future if we left New York City permanently.”

The poll found 59% of respondents strongly or somewhat agreed with the statement, while 41% somewhat or strongly disagreed.

That’s a 12 percentage-point jump from voters who were asked the same question a year ago.

https://nypost.com/2022/04/06/why-majority-of-new-yorkers-would-rather-be-anywhere-else-poll/

Pension plans must produce high growth to maintain value of wealth versus inflation. If inflation is 8% annually, pension plans must grow 8% just to break even. Logically, it makes sense to invest in high growth sectors of the economy like crypto to achieve this.

FTX is an extreme outlier case which shouldn't be considered to represent crypto as a whole. The entire timeline of FTX still makes zero sense and should never have happened if basic laws and regulations were followed. Its still a mystery as to how a long sequence of statistically improbable events aligned for FTX to occur the way it did. New york has always carried a fiercely anti crypto stance which has remained a stark contrast to the crypto friendly stance of states like texas and florida.

[jossiel]

That's for sure related to what happened in Canada with retirees money swindled by FTX.

It's fair to think about the welfare of the retirees and on how they're going to spend well their pension. But, it's still up to them when they have the control of their funds.

Whether they'll spend it on a cruise, a vacation or into investing it on bitcoin. As long as the management of handling the money to them is good, next to it is their decision making and government shouldn't intervene with personal interest and actions.

[dothebeats]

In a way this is to protect them somewhat. Those people built whatever savings they have right now for a good few years, and if they aren't that experienced enough in handling these assets they'd see their money go down the drain in a very heartbreaking manner. While this seems controlling whatever they're trying to impose, it still puts the best interest of seniors and pensioners in mind. Still a better thing to do than let those savings go somewhere else these guys won't even enjoy, and perhaps at their age they shouldn't even bother investing at all.

[noorman0]

-snip-
Recently, news came out of Canada related to 95 million dollars of loss from FTX collapse. Crypto market has already seen a lot of collapses considering it is a relatively new type of investment. So it's better to keep for those people whose risk appetite is high.

I also suddenly remembered Ontario's pension case, my guess is that it is the main preference of the policy urge. It is not known whether retirees will be banned from using cryptocurrencies at all (including bitcoin), given the bankruptcy of some businesses and the impact this industry has had on the detriment of those investing in service-issued cryptocurrencies which have offered additional profit schemes in addition to natural utility growth.

[Hydrogen]

It should be mentioned that they waited until the 2022 US election season was over, before proposing these harsh crypto regulation policies.

Knowing that they would be extremely unpopular with american voters.

Something that has been predicted for more than 6 months now.

[adaseb]

Yes I read about this. The reason why is because due to all these exchanges failing and taking retirement money down with it, it’s not wise to invest.

I there are 2 sides to this. Depositing money on an exchange like FTX for these retirement funds is not smart. I would of preferred if they invested in the Bitcoin etf instead which is considered much more safe. Either way, it’s a diversified small amount. One sector goes down and another goes up. So it’s good for the retirement if they have different sectors of their investment, as long as it’s a small amount.

[The Sceptical Chymist]

This is a simple attack on liberalism and freedom.

I don't know about liberalism, but it's definitely an attack on people's freedom to choose.  Funny enough, in another thread I wrote this:

The only problem is that lawmakers, law enforcement, and a multitude of government agencies don't give a single shit about logical arguments if it means that they might be seen to be twiddling their thumbs when a disaster like FTX (or take your pick from the many crypto has seen) happens. 

All of those entities I just referenced are extremely reactionary and always have been, so as to OP's question....it's anyone's guess if a crackdown could happen. 

And wouldn't you know, here we have an example of such a knee-jerk reaction.  I haven't read the details of this proposal, but I seriously don't think the government (which is taxing us to death and producing massive inflation) should be telling people how to invest their money.  Saying they're trying to protect people from the risks of crypto is a fucking joke.

Hear that, New York?  A fucking joke.

[Lida93]

Most of this retirees know absolutely nothing about how this digital assets work. The just trust this investment plans to make the right decision for them. Attorney General James is only been protective of her citizens to save them from the downtimes because the only depend on pensions for survival as such risking them on assets the can't control themselves can result to sudden death and heart failures. Because they will have to wait till the market becomes favourable to start making profit on their investments.

link

The reason are purely rational, cause to any genuine crypto trader/investor he/she will always advise to not involved a person with no idea on how the digital asset works or not to even agree to use the money of such a person with the agreement of trading for such persons due the the fact that should things go negative against plan there's no way you can explain to such a person about how his/her money was lost that they are going to understand not especially pensioners which hang their lives on their pension money.

So I believe the move is fair as to not drag many pensioners to their early grave should anything happens to their money through the financial  institutions.

[Wexnident]

Wouldn't it be better to let them know of crypto instead of outright banning it? It will protect them from crypto but pretty sure they can think for themselves, give them time to understand how crypto works and let them decide instead. It might even be more advantageous if they set up crypto investment plans together with regular investment plans instead.
With the case of FTX eating up retirement funds, well, that isn't even a crypto issue, it's just a centralized service fucking up and bringing down their customers with them, which can easily be avoided if one wants to.

[Mauser]

Most of this retirees know absolutely nothing about how this digital assets work. The just trust this investment plans to make the right decision for them. Attorney General James is only been protective of her citizens to save them from the downtimes because the only depend on pensions for survival as such risking them on assets the can't control themselves can result to sudden death and heart failures. Because they will have to wait till the market becomes favourable to start making profit on their investments.

I can understand that he wants to protect people from making bad decisions, but an outright ban on crypto currencies as retirement investment is wrong in my opinion. Even though a large part of the population might be unfamiliar with cryptos, there are still people who understand them and would like to have them in their retirement investment. Why can't there be better regulation to protect consumers instead of banning it directly? A good approach would be to make sure that everybody who wants to invest his retirement funds in cryptos is aware of the risks involved. In my country most of the private retirement schemes pool the money and buy investment funds with it. These investment funds have fixed guidelines for the assets they can buy. In most cases this is 60-80% fixed income, 20-40% stocks with only a very small fraction of 5-10% in commodities. To me it seems totally fine if we invest in a fund that would also add 5-10% crypto investments. These investment funds for our retirement are very long term investments that are not being traded too actively. Holding some cryptos for the next 30-40 years seems fine and we shouldn't worry about short term price fluctuations.  

[dezoel]

Wouldn't it be better to let them know of crypto instead of outright banning it? It will protect them from crypto but pretty sure they can think for themselves, give them time to understand how crypto works and let them decide instead. It might even be more advantageous if they set up crypto investment plans together with regular investment plans instead.
With the case of FTX eating up retirement funds, well, that isn't even a crypto issue, it's just a centralized service fucking up and bringing down their customers with them, which can easily be avoided if one wants to.

I think those people already know crypto because they already have a crypto account. If there is one who must know and educate themselves more in crypto, that would be the one that will conduct a ban. They must know how useful crypto was, that it shouldn't be banned. Crypto helps protect people's money like for example in times of inflation. Cryptos are good for long term, especially for those who are working.

By the time, they want to retire their money have also grown a lot in crypto. Having a regular investment plan other than crypto is also a good idea. It works as a back plan in case something bad happens with our crypto investment even tho it's unlikely.

[Jody.Drummer]

Indeed, in this case there are some things that do look like good things to do but when banning them as a whole is clear it is like putting a limit on the freedom to control what we have.
It's a very good goal indeed but would this pensioner accept that kind of thing. because I think everyone has their own desires and of course of the many retirees there, there must be some of them who want to be in bitcoin for the end of their lives.