The U.S. Labor Department has “grave concerns” about Fidelity Investments allowing investors to put bitcoin into their 401(k) accounts for retirement savings. An official of the Labor Department said it risks the retirement security of Americans, stressing that “cryptocurrencies can present serious risks to retirement savings.”
U.S. Labor Department’s ‘Grave Concerns’ Over Fidelity’s Bitcoin 401(k) Offering
The U.S. Labor Department is deeply concerned about Fidelity Investments’ new offering to allow investors to put up to 20% of their 401(k) savings and contributions into bitcoin (BTC). A 401(k) is a popular workplace savings plan in the U.S that has tax advantages as an incentive to invest for retirement.
Ali Khawar, Acting Assistant Secretary of the Labor Department’s Employee Benefits Security Administration, said in an interview with The Wall Street Journal Friday:
We have grave concerns with what Fidelity has done.
Khawar explained that Labor Department believes that Fidelity allowing savers to put bitcoin into their 401(k) accounts risks the retirement security of Americans.
The official said that he views cryptocurrency as speculative. There is “a lot of hype around ‘You have to get in now because you will be left behind otherwise,’” he opined.
Khawar wrote a blog post on the Department of Labor’s website in March raising concerns about retirement plans investing in cryptocurrencies. He detailed:
The U.S. Department of Labor has serious concerns about plans’ decisions to expose participants to direct investments in cryptocurrencies or related products, such as NFTs, coins, and crypto assets.
He explained that “cryptocurrencies can present serious risks to retirement savings,” citing valuation challenges, price volatility, and the evolving regulatory landscape.
Do you think the U.S. Department of Labor should be worried about Fidelity allowing investors to put bitcoin into their 401(k) accounts? Let us know in the comments section below.
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Source: https://news.bitcoin.com/fidelitys-bitcoin-401k-offering-risks-retirement-security-of-americans-says-labor-department-official/