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.
The proposal is a response to President Donald Trump’s executive order, issued in August, which directed the Labor Department 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 passed, the rule would mark a shift in how pension plans are structured. For years, most 401(k)s have focused on stocks and bonds. The new approach will allow plan providers to add a broader mix of assets, including digital tokens and private market funds that don’t trade on public exchanges.
The move builds on previous changes. Last May, the Labor Department rescinded earlier guidance urging administrators to exercise “extreme care” before adding crypto to pension plans. Trump’s executive order went further, calling for digital assets to be treated on an equal footing with 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 tumble, President Trump has decided now is the time to shove all these risky assets into Americans’ 401(k)s,” Sen. Elizabeth Warren said in a statement. She warned that the rule could expose workers to losses while benefiting large financial firms.
The stakes for crypto can be high. US 401(k) plans hold trillions of dollars in retirement savings, and even a small shift to digital assets can send new capital into the market. If a large scheme with tens of thousands of workers were to allocate just 1% of its portfolio to bitcoin, that would translate into millions of dollars flowing into crypto funds or tokens.
