US President Donald Trump is set to sign an executive order that may pave the way for cryptocurrencies to be incorporated into 401(k) retirement plans, potentially transforming how Americans allocate their savings.
The White House Press Office confirmed to Cointelegraph on Thursday that the directive instructs the US Labor Department to reassess limitations surrounding alternative assets in defined-contribution plans, inclusive of digital currencies, private equity, and real estate.
A senior official from the White House stated that the order directs the Secretary of Labor to clarify the department’s position on alternative assets and to furnish guidance on fiduciary responsibilities for integrating these types of investments into retirement portfolios.
Trump will permit crypto access for $12.5 trillion 401(k) market
Once enacted, the order might provide Americans with access to digital assets via their 401(k) plans — a component of a $12.5 trillion retirement sector and an attractive opportunity for crypto companies aiming to connect with more retail investors.
This initiative would mark a substantial advancement for the crypto sector, which has long pursued wider retail engagement and acknowledgment within the financial ecosystem.
Though institutional investors have been boosting crypto allocations, everyday savers have encountered limitations due to fiduciary risks, regulatory ambiguities, and volatility concerns.
The White House official indicated that Trump’s directive would call for collaboration among various agencies, including the US Treasury and the Securities and Exchange Commission (SEC), to examine potential rule modifications that could facilitate the inclusion of alternative investments such as crypto in retirement products.
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Final authority rests with Trump on executive order
On July 18, the Financial Times referred to anonymous sources, reporting that the president is considering alternative investments like crypto assets for American 401(k) retirement schemes.
In a prior statement to Cointelegraph, White House spokesman Kush Desai emphasized that nothing should be regarded as official unless it comes directly from Trump.
Desai asserted that Trump is dedicated to restoring prosperity for everyday Americans and ensuring their economic future. “No decisions should be deemed official unless they originate from President Trump personally,” Desai noted.
During a Bloomberg discussion, US SEC Chair Paul Atkins stressed the importance of education regarding the risks involved with crypto as an investment.
Atkins stated that disclosure is essential and that individuals should be informed of what they are entering into. He added that he looks forward to the president’s actions.
Earlier this year, the Labor Department rescinded a prior guidance regarding crypto in 401(k) plans. On May 28, the Labor Department nullified a 2022 recommendation that advised fiduciaries to be “highly cautious” when considering crypto for 401(k) retirement plans.
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