Trump Signs Executive Order to Allow Crypto in 401(k) Retirement Plans

President Donald Trump signed an executive order on Thursday aimed at expanding investment options in 401(k) retirement plans to include cryptocurrency, private equity, and other alternative assets. This move seeks to unlock a portion of the approximately $12.5 trillion held in these accounts by directing key federal agencies to streamline access for everyday investors. The order, first reported by Bloomberg, instructs the Labor Department, Securities and Exchange Commission, Treasury Secretary, and others to collaborate on implementation.

The directive emphasizes the need for regulatory adjustments to make these assets more available in participant directed defined contribution plans. It specifically calls on the SEC to work with the Treasury Secretary to explore revisions to rules around accredited investor and qualified purchaser status. These changes aim to align with broader policy goals of increasing financial innovation while maintaining oversight.

For cryptocurrency enthusiasts, this represents a significant shift from previous regulatory hurdles that kept digital assets out of mainstream retirement portfolios. Until now, opposition from agencies often cited concerns over volatility and investor protection as barriers. The order removes asset-specific disqualifications, allowing fiduciaries to include crypto as long as they meet ERISA standards for prudence and care.

Investors could soon see crypto options in their 401(k) lineups, though safeguards on disclosure, valuation, and custody remain essential to protect retail savers. The Labor Department has signaled plans to coordinate with the SEC on potential new rules to support this integration. This development comes amid growing interest in digital assets as part of diversified retirement strategies.

Regulatory Framework and Agency Actions

The executive order builds on Trump’s earlier actions to promote cryptocurrency in the United States. In January, he issued a directive focused on U.S. leadership in the crypto space, which led to a comprehensive 168-page report with regulatory recommendations. Another order established a strategic Bitcoin reserve and digital asset stockpile, underscoring a consistent push toward mainstream adoption.

The SEC is poised to take concrete steps to ease access to crypto and private markets for retirement plan participants. This could involve updating guidance to better accommodate these assets without compromising investor safeguards. Industry players like Blackstone, Apollo, and KKR stand to gain, having invested heavily in infrastructure and advocacy for private market inclusion in 401(k) funds.

Fiduciaries will continue to bear responsibility for ensuring any alternative investments align with duty-of-care requirements under ERISA. The order does not eliminate the need for thorough due diligence, particularly given the potential for high fees and market swings in crypto. Agencies are expected to prioritize clear guidelines to help plan sponsors navigate these additions.

This latest executive order fits into a pattern of policy initiatives designed to foster innovation in financial markets. By directing inter-agency cooperation, it sets the stage for rulemaking that could reshape retirement investing. Stakeholders in the crypto sector view it as a step toward greater legitimacy and broader participation.

Private equity firms have long pushed for access to the vast pool of 401(k) capital, and this order accelerates that momentum. Their established networks and lobbying efforts position them well to capitalize on the changes. As the Labor Department assesses further actions, the focus will likely remain on balancing opportunity with risk management.

Cryptocurrency’s inclusion could introduce new dynamics to retirement planning, offering potential for higher returns alongside increased exposure to market fluctuations. Plan participants may benefit from diversified options, but education on these assets will be crucial. The order encourages agencies to consider ways to enhance transparency and investor confidence in this evolving landscape.