The U.S. Department of Labor has proposed a rule that would make it easier for 401(k) plans to include alternative assets such as cryptocurrencies, private equity and real estate.
This proposal follows President Donald Trump’s executive order, issued in August, which directed the Department of Labor and the Securities and Exchange Commission to facilitate expanded access to alternative assets in 401(k)s.
“This proposed rule will show how plans can consider products that better reflect the investment landscape as it exists today,” Labor Secretary Lori Chavez-DeRemer said in a statement.
If adopted, the rule would mark a change in the way retirement plans are constructed. For years, most 401(k)s focused on stocks and bonds. The new approach would allow plan providers to add a broader mix of assets, including digital tokens and private market funds that are not traded on public exchanges.
This decision builds on previous changes. Last May, the Department of Labor reversed previous guidance that urged fiduciaries to exercise “extreme caution” before adding crypto to retirement plans. Trump’s executive order went further, calling for digital assets to be treated equally to other investment options.
Still, the proposal has drawn criticism from some lawmakers and financial advisers.
“As cracks appear in the private credit market, private equity returns fall to 16-year lows, and crypto continues to plummet, President Trump has decided the time has come to put all of these risky assets into America’s 401(k)s,” Sen. Elizabeth Warren said in a statement. She warned that the rule could expose workers to losses while benefiting large financial companies.
The stakes for crypto could be high. America’s 401(k) plans hold billions of dollars in retirement savings, and even a small shift to digital assets could send new capital into the market. If a large project with tens of thousands of workers allocated just 1% of its portfolio to bitcoin, that would translate into millions of dollars invested in crypto funds or tokens.
