President Trump Signs Order Letting Crypto Into 401(k) Retirement Plans

TL;DR

• 401(k) retirement plans can now invest in a wide range of assets, including cryptocurrencies.

• President Trump also signed an order directing bank regulators to prevent debanking.

Trump’s New Executive Order Opens Up Crypto to 401(K) Plans

United States President Donald Trump signed an executive order on Thursday, allowing cryptocurrency investments in 401(k) retirement plans. This latest development could result in millions of dollars flowing into the crypto market. 

The order allows for private equity investments and is set to increase the scope of what retirement plan providers can direct funds to. The increased adoption could catalyze crypto prices to soar higher while also integrating cryptos with the broader financial system.

Cryptocurrencies were never banned from retirement plans. However, the U.S. Department of Labor previously put out guidance for fiduciaries to exercise extreme care before they consider adding digital assets to a 401(k) plan's investment menu for plan participants.

Thanks to Trump’s order, the Department of Labor will now publish a new guidance, putting cryptocurrencies in the same bucket as other assets. The move could help wealth managers who had avoided cryptocurrencies reconsider their positions, potentially bringing millions of dollars into ETFs and spot positions. 

While commenting on this latest milestone, 

“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.”

The order saw crypto prices rally higher after underperforming all week. Bitcoin hit the $117k while Ether is eyeing the $4k resistance level once again. 

President Trump also signed an order to ensure that Federal regulators do not promote policies and practices that allow financial institutions to deny or restrict services based on political beliefs, religious beliefs, or lawful business activities, ensuring fair access to banking for all Americans

With this order, the Small Business Administration and the Treasury Secretary, alongside other officials, are set to eliminate the use of reputation risk or equivalent concepts that could result in politicized or unlawful debanking within the next six months.

While the order didn’t mention crypto, the fact sheet highlighted that the digital assets industry has also been the target of unfair debanking initiatives.