Trump is preparing to sign an executive order allowing crypto and gold investments in U.S. retirement plans like 401(k)s, possibly as early as this week, according to the FT.

Trump is preparing to sign an executive order allowing crypto and gold investments in U.S. retirement plans like 401(k)s, possibly as early as this week, according to the FT.

President Donald Trump is reportedly set to sign an executive order that would allow U.S. retirement plans, such as 401(k)s, to include crypto assets and gold as investment options. The order, expected to be signed as early as this week, would direct the Labor Department and the Securities and Exchange Commission to issue guidance for employers and plan administrators on incorporating these alternative investments into retirement plans [1].

The move is part of a broader push to make private-market investments more accessible to U.S. retirement plans. According to Reuters, the executive order would instruct the U.S. Labor Department and the Securities and Exchange Commission to provide guidance on including investments like private assets in 401(k) plans [2]. This guidance would mark a substantial shift in federal policy, potentially opening up enormous pools of individual retirement savings to private equity and alternative investments.

The executive order is aimed at expanding access to alternative investments, which include private equity, venture capital, real estate, and hedge funds. These assets are not traded on public exchanges and are typically characterized by higher risk and potentially higher returns compared to traditional public-market investments like stocks and bonds. The move would allow large private asset managers such as Apollo Global Management (NYSE:APO) and Blackstone (NYSE:BX) to tap into the significant retirement savings held by workers without traditional pensions [1].

The order comes amid increasing interest in private-market investments and reports of the world’s super-rich having a growing affinity for private credit offerings. However, the decision to offer private equity as an investment option in workplace retirement plans has been met with criticism. Senator Elizabeth Warren (D-Mass) has challenged Empower, a major retirement plan provider, over its decision to include private equity investments for their employees [1].

Despite the criticism, Empower CEO Ed Murphy has defended the move, likening it to the introduction of 401(k) plans decades ago and emphasizing the importance of making private markets more accessible. Bryan Corbett, president and CEO of MFA, a trade association representing alternative asset management options, also hailed the expected order, stating that it would provide more Americans with the diversification and investment options needed to build wealth and save for successful retirement [2].

The executive order builds on a broader push to bring digital assets into mainstream finance. In May, the Department of Labor rescinded a Biden-era rule that discouraged plan administrators from offering crypto exposure [3]. The move would allow 401(k) plans to include digital assets and alternative assets, reshaping how Americans invest for retirement [3].

Further legislative or regulatory reforms may be necessary to determine whether the proposed order results in long-lasting change. However, private equity firms have a strong incentive to continue advocating for access, given the trillions of dollars in potential capital that are at stake [4].

References:
[1] https://finance.yahoo.com/news/trump-set-sign-executive-order-113030234.html
[2] https://finance.yahoo.com/news/trump-order-help-open-retirement-220514572.html
[3] https://cryptobriefing.com/trump-401k-crypto-order/
[4] https://www.nasdaq.com/articles/trump-sign-executive-order-open-401k-private-markets