A US federal judge rejected ForUSAll’s lawsuit against the Department of Labor (DOL).
The move upholds the agency’s cautionary stance that cryptocurrencies may not be suitable for retirement savings.
ForUSAll sued the DOL in June last year, arguing that its efforts to limit cryptocurrency in retirement accounts were “arbitrary and capricious.”
In March, the Department of Labor released guidelines for 401(k) plans contemplating crypto investments and warned of potential investigations for those offering such options.
After that announcement, ForUSAll claimed that about one-third of its plan participants decided not to move forward due to concerns about enforcement actions.
ForUsAll requested the court to rule that the department’s statement is illegal and to nullify and overturn it.
But US Judge Christopher Cooper said in a memorandum on Tuesday that even if the guidance were to be revoked, it wouldn’t alter the DOL’s perspective on the risks associated with cryptocurrency or its intention to scrutinize such offerings.
ForUsAll lacks the legal standing to proceed due to unproven redressability, according to the judge.
“Without clear evidence to the contrary, it is hard to fathom how this relief would restore ForUsAll’s lost business opportunities because it is doubtful that plan fiduciaries would disregard these lingering risks and partner with ForUsAll if the Release itself were no longer effective,” Cooper said.
He added that it’s improbable that retirement plans will readily re-engage with ForUsAll because it is still governed by fiduciary responsibilities, which are likely to be stringently enforced by a department that remains skeptical about cryptocurrency.
ForUsAll started offering alternative investment choices in 401(k) plans in 2021, using Coinbase Institutional for digital asset custody and trading.
The company manages $1.5 billion in assets and serves more than 80,000 retirement savers across over 500 plans, with clients including Solana, TaxBit and Uniswap.
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Source: https://blockworks.co/news/labor-department-crypto-retirement-plans