U.S. Treasury Secretary Janet Yellen is issuing a warning to those who choose leading crypto asset Bitcoin (BTC) as an investment option for their 401(k) retirement plans.
In a new interview with The New York Times, Yellen says that financial services giant Fidelity’s recent plan to offer up Bitcoin as an investment option for employee retirements is risky but notes it could be more reasonable if regulators took action.
“It’s not something that I would recommend to most people who are saving for their retirement. To me, it’s a very risky investment.
Tax laws have created the opportunity to save in tax-advantaged ways and if Congress wanted to get involved in legislating in this area and say ‘We’ve given tax incentives for 401(k)s and retirement plans and we want to regulate what form that savings can take,’ to my mind, that would be legitimate.
I’m not recommending it but that to my mind would be a reasonable thing.”
The U.S. Department of Labor also had raised concerns about Fidelity’s plan in the past, saying that digital assets need to mature before they can be safely allocated toward people’s retirements.
Fidelity first unveiled its plan to allow customers to choose Bitcoin for 401(k)s in April, though only a maximum of 20% of an individual’s portfolio can be in BTC.
According to Fidelity, the decision was driven by consumer demand.
As previously stated by David Gray, head of Fidelity’s workplace retirement offerings and platforms,
“We started to hear a growing interest from plan sponsors, organically, as to how could Bitcoin or how could digital assets be offered in a retirement plan.”
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Source: https://dailyhodl.com/2022/06/11/us-treasury-secretary-janet-yellen-warns-against-investing-in-bitcoin-btc-for-retirement-heres-why/