In a move that could redefine retirement planning in the U.S., President Donald Trump has signed an executive order permitting the inclusion of cryptocurrencies in 401(k) retirement plans. The decision, announced on Thursday, is expected to channel billions into the burgeoning digital asset class, broadening the horizons for retirement fund managers and potentially boosting crypto valuations. As explored in our recent coverage of Trump’s plan to open 401(k)s to crypto, Bitcoin has already seen a significant rally in anticipation of these changes.
Expanding the Investment Palette
Trump’s order is a game-changer, allowing not just digital currencies but also private equity and real estate to be considered alongside traditional assets in retirement portfolios. This shift could incentivize financial advisors to explore cryptocurrencies, which have, until now, been largely off-limits due to previous guidance from the Department of Labor. The move comes after the rescinding of a May advisory that urged extreme caution in adding cryptocurrencies to 401(k) options. Now, with the Department poised to issue new guidelines equating crypto with other assets, wealth managers might find themselves reconsidering their strategies.
“This order isn’t about the government saying ‘crypto belongs in 401(k)s.’ It’s about the government getting out of the way and letting people make their own decisions,” remarked Matt Hougan, chief investment officer at Bitwise. His sentiment reflects a broader wave of deregulation that seems to be defining the current administration’s approach to financial markets.
A Boon for Crypto Markets?
Crypto enthusiasts are already celebrating what appears to be a significant victory. The timing couldn’t be better. Digital assets have been riding a wave of positive momentum, with Bitcoin reaching a staggering $117,351, up 26% since the start of the year. The reduction in Bitcoin’s volatility, now at levels last seen in 2023, suggests a maturing market that’s increasingly appealing to institutional investors. For a deeper dive into the recent price movements, see our analysis of Bitcoin’s rally on retirement reform.
The implications of Trump’s order are vast. While some wealth managers may remain cautious, preferring the relative safety of ETFs over direct crypto investments, others might seize the opportunity to diversify. The success of spot bitcoin ETFs like BlackRock’s iShares Bitcoin Trust (IBIT), which commands over $85 billion in assets, is a testament to the growing appetite for crypto exposure within traditional investment vehicles.
“I already trade the BTC ETFs in my IRA. I think the BTC ETFs are fine for retirement accounts. But straight coin seems too risky and would be better suited to non-retirement accounts,” noted Jeffrey Hirsch, CEO of Hirsch Holdings. His perspective underscores a cautious optimism that could characterize the initial response from the investment community.
The Broader Regulatory Landscape
Trump’s actions on Thursday weren’t limited to crypto. Another executive order addressed the contentious issue of “debanking,” aiming to prevent financial institutions from denying services based on political or religious beliefs. While the order did not specifically reference digital currencies, it highlighted the administration’s commitment to ensuring equitable access to financial services—a sentiment that resonates with the crypto community, which has often felt marginalized by traditional banking systems.
According to a fact sheet from the White House, the order directs federal regulators to eliminate practices that could lead to politically motivated debanking within six months. The digital assets industry, which has sometimes been caught in the crossfire of such practices, may find solace in these developments.
Looking Ahead
As the dust settles on these groundbreaking announcements, the crypto community is left with a mix of excitement and uncertainty. Will wealth managers embrace the newfound freedom to incorporate digital assets into retirement plans? Or will caution prevail, with advisors sticking to the perceived safety of ETFs and traditional investments?
Only time will tell. However, one thing is clear: the landscape of retirement planning in the U.S. has been irrevocably altered. As new guidance from the Department of Labor emerges in the coming months, the financial industry will be watching closely, eager to see how these changes unfold. Could this be the dawn of a new era where digital assets become a staple in retirement portfolios? The potential is there, but as always, the market will have the final say.
Source
This article is based on: Donald Trump Signs Order Letting Crypto Into 401(k) Retirement Plans
Further Reading
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Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
