Allowing crypto in 401(k) plans would let participants gain regulated exposure to digital assets; nine US lawmakers urged the SEC to act on the executive order to enable crypto investments in 401(k) plans and update guidance to permit modest allocations under fiduciary oversight.
Lawmakers asked the SEC to speed adoption of crypto in 401(k) plans
Even a 1% allocation of the $9.3 trillion 401(k) market could channel roughly $93 billion into crypto ETFs.
State pension moves show growing institutional appetite: Michigan added $10.7M to a bitcoin ETF in Q2.
Crypto in 401(k) plans: SEC urged to enable 401(k) crypto investments; learn potential inflows, fiduciary guidance, and next steps for plan sponsors.
Nine US lawmakers asked the SEC to move forward on last month’s EO to speed up the inclusion of alternative assets like crypto in US retirement funds.
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US lawmakers have called on Securities and Exchange Commission Chair Paul Atkins to help accelerate the executive order enabling crypto investments in US 401(k) retirement plans. The letter requests regulatory adjustments and faster guidance to permit participant-directed crypto access under fiduciary rules.
In the letter on Monday, nine lawmakers, including House Financial Services Committee Chairman French Hill and Subcommittee on Capital Markets Chairman Ann Wagner, asked Atkins to “provide swift assistance” to the Secretary of Labor and update existing rules so alternative assets can be offered within 401(k) plans when appropriate.
The lawmakers referenced President Donald Trump’s August executive order on “Democratizing Access to Alternative Assets for 401(k) Investors,” which instructed agencies to consider how accredited investor and qualified purchaser rules affect participant access to alternative assets like crypto.
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Allowing crypto in 401(k) plans would give plan participants regulated exposure to digital assets under plan fiduciaries, potentially improving diversification and long-term returns for some investors. Any inclusion would be subject to fiduciary duty, risk assessment, and plan design controls.
Even a 1% allocation of the $9.3 trillion held in US 401(k) plans could direct roughly $93 billion into crypto exchange-traded products. For context, spot Bitcoin ETPs attracted about $60.6 billion since January 2024. Small percentage allocations at scale matter.
Lawmakers argue that regulatory clarity is required after the Labor Department reversed prior anti-crypto guidance in May. The letter urges the SEC to align its rules to facilitate access while preserving investor protections for fiduciaries and plan participants.
Not universally. Sponsors must follow ERISA fiduciary duties and existing SEC and Labor Department guidance; lawmakers want the SEC to issue updated rules to clarify when crypto can be offered as a plan option.
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