Trump Signs Order Expanding 401(k) Investments to Crypto and Private Equity

President Donald Trump is set to sign an executive order that will expand the range of investment options available in 401(k) retirement plans to include alternative assets such as cryptocurrency, real estate, and private equity. The directive instructs the U.S. Department of Labor to reassess its existing rules on permissible asset types under the Employee Retirement Income Security Act (ERISA), with the goal of allowing plan participants greater access to a broader array of investment vehicles [1].

The order also calls for the Department of Labor, the Securities and Exchange Commission (SEC), and other relevant agencies to collaborate on regulatory adjustments needed to facilitate the inclusion of these alternative investments. Specifically, the SEC will be tasked with removing barriers to allow 401(k) participants to invest in assets beyond traditional stocks and bonds. Additionally, the directive clarifies fiduciary responsibilities for retirement plan administrators offering exposure to riskier and less liquid assets [1].

The move reflects Trump’s broader strategy to integrate digital assets into U.S. economic policy. In recent months, the administration has hosted a “Crypto Week,” passed the first federal stablecoin legislation, and announced the creation of a Strategic Bitcoin Reserve. The administration has also appointed David Sacks, a crypto-friendly venture capitalist, as the White House’s first-ever AI and crypto czar [1].

Industry groups have long advocated for this change, arguing that the current retirement investment landscape does not reflect the evolution of capital markets. They note that the number of public companies in the U.S. has declined significantly since the 1990s, while private equity assets have more than doubled over the past decade. Supporters of the policy believe that allowing alternative assets in 401(k)s will provide American workers with opportunities for higher returns and greater portfolio diversification [1].

However, critics have raised concerns about the risks involved. They warn that savers could face steeper fees and legal risks due to the complexity and illiquidity of many private investments, particularly in the crypto and real estate sectors [1]. The initiative also revives policies introduced during Trump’s earlier term but later rolled back under the previous administration.

Notably, the crypto industry has been a significant source of political support for Trump. Campaign finance records show that crypto firms and individuals have contributed over $26 million to Trump and his allies this year. Major donors include Blockchain.com, which contributed $5 million, and venture capitalists such as Marc Andreessen and Ben Horowitz, each giving $3 million. Other notable contributors include Gemini Trust and the Winklevoss twins [1].

Trump’s personal financial ties to the crypto sector are also substantial. According to the Bloomberg Billionaires Index, TMTG stock accounts for approximately $2.2 billion of his $6.6 billion fortune. His cryptocurrency investments are estimated to have gained at least $620 million in recent months. Moreover, nearly 70 Trump administration officials and nominees reportedly hold crypto or investments in blockchain companies [1].

The executive order represents a significant shift in U.S. retirement policy and reflects the increasing influence of the crypto and private investment sectors in American financial markets. It remains to be seen how the implementation will proceed and whether it will lead to broader adoption or increased scrutiny of alternative asset investments in retirement plans.

Source: [1] Trump to Sign Order Opening 401(k)s to Crypto, Real Estate, and Private Equity – What It Means for You (https://cryptonews.com/news/trump-to-sign-order-opening-401ks-to-crypto-real-estate-and-private-equity-what-it-means-for-you/)