New Bill Would Allow 401(k) Investments in Crypto
Finally what looks like some good news coming out of Washington. Three members of Congress have put forward legislation designed to broaden the range of investments 401(k) managers other such plans can make to include digital assets.
The devil is always in the details and we haven’t read the bill in detail yet – it’s available here – but what’s encouraging is one of the authors is US Sen. Pat Toomey, R-PA, who has been a solid advocate for the crypto industry. The bill would allow fiduciaries to recommend cryptocurrencies without legal liability. It has broad support from the investment community.
From The Block:
The legislation has the backing of three Republicans: outgoing Senate Banking Committee Ranking Member Pat Toomey (R-Pa.), Sen. Tim Scott (R-S.C.), and Rep. Peter Meijer (R-Mich.) in the House of Representatives.
In statements upon the bill's introduction, the three congressmen cited inflation and "fiscal uncertainty" as motivation for expanding retirement investment options. They also note that far more Americans rely on 401(k)s than traditional pensions for their retirements, but criticize limits on 401(k) investments as reducing overall returns compared to those traditional pensions.
“Our legislation will provide the millions of American savers invested in defined contribution plans with the option to enhance their retirement savings through access to the same wide range of alternative assets currently available to savers with defined benefit pension plans," said Toomey in a release touting the bill.
The bill is broader than digital assets, but Toomey in particular has established an image as a leading crypto advocate on the Hill. But many in government — notably the Department of Labor, which regulates retirement plans — are skeptical to the inclusion of crypto in retirement plans.