Trump Signs Orders to Curb Debanking and Expand 401(k) Alternative Assets

On August 7, 2025, Donald J. Trump signed a sweeping executive order aimed at curbing what his administration described as “politicized or unlawful debanking.” The directive prohibits financial institutions and federal regulators from denying services to individuals or businesses based on political beliefs, religious affiliations, or lawful economic activities, including those in the cryptocurrency sector [1]. This marks a significant shift in regulatory focus, with the White House emphasizing that the order is intended to protect free expression and economic participation within the U.S. financial system [2].

The executive order, titled “Guaranteeing Fair Banking for All Americans,” mandates that federal banking regulators eliminate language and practices in their guidelines that support debanking. The policy also seeks to remove the concept of “reputational risk” as a basis for denying financial services, a factor previously used by some institutions to justify cutting off certain clients [3]. The administration cited several examples of alleged discriminatory practices, including a major bank that denied ticket-processing services for a Republican event and federal regulators encouraging banks to flag transactions involving companies such as Bass Pro Shop or Cabela’s [4]. The White House also noted that two major banks reportedly denied services to Trump’s own business ventures.

Trump criticized the banking industry for, in his view, favoring liberal ideologies and discriminating against conservatives and religious groups. “Nobody knows the banking industry better than me, and I’m not going to let them take advantage of you any longer,” he said [5]. The order mandates that regulators review current and past bank policies for evidence of unlawful debanking and take corrective measures, including potential fines or consent decrees. Cases involving religious discrimination are to be reported to the Attorney General for further action [6].

In parallel, Trump signed a second executive order titled “Democratizing Access to Alternative Assets for 401(k) Investors.” This directive allows more than 90 million private-sector workers to include alternative assets such as digital assets, private equity, and real estate in their retirement portfolios [7]. The White House stated that the move is intended to “level the playing field” between public and private sector employees and provide Americans with more tools to achieve long-term financial security. The change is expected to expand investment options for millions and promote greater diversification of retirement assets [8].

Digital asset advocates view these orders as a major step forward for the crypto industry, which has long struggled with limited access to traditional banking services. The executive actions are expected to increase scrutiny of financial institutions and promote a more transparent and competitive environment [9]. Analysts note that the success of these policies will depend on how effectively federal regulators enforce the new directives and whether institutions comply without resistance [10].

By addressing concerns over debanking and promoting the inclusion of alternative assets in mainstream financial products, the executive order reflects the Trump administration’s broader goal of fostering innovation and diversification within the U.S. financial system [11].

Source: [1] Trump signs order to allow crypto and real estate ... (https://www.theguardian.com/us-news/2025/aug/07/trump-executive-order-cryptocurrency)

[2] Trump orders federal regulators to probe alleged bank ... (https://www.startribune.com/trump-orders-federal-regulators-to-probe-alleged-bank-discrimination-against-conservatives/601451530)

[3] Trump signs executive order to stop banks from cutting off ... (https://www.thestreet.com/crypto/policy/trump-signs-executive-order-curb-debanking-by-banks)

[4] Donald Trump Signs Order Letting Crypto Into 401(k) ... (https://www.coindesk.com/policy/2025/08/07/donald-trump-signs-order-letting-crypto-into-401-k-retirement-plans)

[5] Trump Shakes Up Wall Street With Orders on 401(k)s, ' ... (https://www.wsj.com/finance/regulation/trump-shakes-up-wall-street-with-orders-on-401-k-s-debanking-82d457ba?gaa_at=eafs&gaa_n=ASWzDAjeBrgRBJRtWWOcAinb_R74OFCUK2C9G_6jtmYZxuT-lucvayIPKM2Y&gaa_sig=-Ldt2NczAob8KIFacMKbFHo2_msVLj8eAxcJ4Wcscde6VfSRuZlSAyPV8LAP6XzggMMmsL_CQeMwvZiNaK28hw%3D%3D&gaa_ts=6895486a)

[6] Trump 401(k) Order Opens Door for Crypto, Private Equity ... (https://www.nytimes.com/2025/08/07/business/trump-401k-crypto.html)