Following President Donald Trump’s order, the US Labor Department is advancing a rule that would allow companies to sell Bitcoin and other cryptocurrencies in 401(k) plans. In order to allow plan sponsors to handle cryptocurrency like other “alternative investments,” like with private equity and real estate, the proposal would amend ERISA’s fiduciary guidelines.
The White House’s Office of Information and Regulatory Affairs approved a proposed rule titled “Fiduciary Duties in Selecting Designated Investment Alternatives” for publication on March 24. The review labeled the rule “economically significant,” indicating it may affect a sizable share of the 13.9 trillion dollar US defined‑contribution market.
Trump Order Reverses Biden-Era Crypto Caution
This move builds directly on an August 2025 executive order from Trump that told agencies to “facilitate access” to assets like cryptocurrency, private equity, and real estate in 401(k) plans. Earlier, the Labor Department had revoked a Biden‑era bulletin that warned employers to use “extreme care” before adding crypto options and signaled extra enforcement risk.
The department says it is taking a more “neutral” stance and will not automatically punish fiduciaries who include crypto, as long as they follow normal prudence rules. “The Department is neither endorsing, nor disapproving of, plan fiduciaries who conclude the inclusion of cryptocurrency…is appropriate,” one analysis quoted the agency as saying.
What Changes for Employers
The draft rule would not force any employer to offer Bitcoin in a 401(k). Instead, it aims to reduce legal uncertainty so large providers and plan sponsors can add carefully limited crypto options, such as a small digital‑asset sleeve inside a broader fund menu. This could open a potential $10 trillion to $14 trillion retirement market to Bitcoin over time.
Critics warn that volatility and fraud risks still make crypto a poor fit for retirement savings, even with clearer rules. The Economic Policy Institute noted the Labor Department had previously cited “substantial risks of fraud, theft, and loss” and that easing the guardrails now looks like a political favor to a president who has launched his own meme coin.
The Labor Department will hold a public comment period before releasing a final version of the rule because it is still in its proposed form. Consumer activists will likely demand stricter caps and disclosures on any cryptocurrency alternatives, while trade associations for asset managers and plan sponsors will argue for flexibility.
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