Trump's Order: Crypto in $9T Retirement Market?
Trump's Executive Order Targets Crypto in Retirement Plans
Former President Donald Trump is expected to sign an executive order that could pave the way for including crypto assets in 401(k) retirement plans. The order, reported by Bloomberg, aims to broaden investment options for retirement savers by including private equity, real estate, and digital assets.
Opening the $9 Trillion 401(k) Market
The potential policy shift targets the vast American retirement market. Data from the Investment Company Institute indicates that as of March 31, 2025, Americans held over $12 trillion in employer-based Defined Contribution (DC) retirement plans, with approximately $9 trillion in 401(k) plans.
Key Policy Changes
Re-evaluating Existing Guidance
The executive order would instruct the Department of Labor to re-evaluate existing guidance that has traditionally discouraged including illiquid or complex assets in retirement plans governed by the Employee Retirement Income Security Act of 1974 (ERISA).
Clarifying Fiduciary Responsibilities
Labor officials would also be directed to clarify fiduciary responsibilities for plan sponsors offering asset allocation funds with exposure to alternative investments.
Inter-Agency Coordination
Trump intends to direct Labor Secretary Lori Chavez-DeRemer to work with the Treasury Department, Securities and Exchange Commission (SEC), and other federal agencies. The goal is to explore potential rule changes that would expand access to alternative assets for participant-directed retirement plans.
The SEC is expected to play a key role in enabling these products to enter the 401(k) landscape.
Impact and Implications
The overarching goal of Trump’s executive order is to ease restrictions that have historically kept alternative assets like private equity, real estate, and crypto out of 401(k) retirement plans. This policy shift could create new investment opportunities and risks for retirement savers while simultaneously expanding the scope for asset managers.