The agency says it will be neutral on whether retirement plan fiduciaries include cryptocurrency options.
The U.S. Department of Labor on May 28
rescinded 2022 guidance that warned fiduciaries against including cryptocurrency in 401(k) retirement plans, reversing a Biden-era policy that critics said discouraged innovation in retirement investing.
The 2022 compliance
release had advised plan fiduciaries to exercise “extreme care” before adding crypto assets. The department now says that this language deviated from the standards of the Employee Retirement Income Security Act (ERISA), which lays out fiduciary duties to act prudently and solely in the interest of plan participants.
“The Biden administration’s Department of Labor made a choice to put their thumb on the scale,” Secretary of Labor Lori Chavez-DeRemer said in a
release. “We’re rolling back this overreach and making it clear that investment decisions should be made by fiduciaries, not DC bureaucrats.”
The updated
policy reaffirms a neutral, principles-based approach, the secretary said in a statement. It states that fiduciaries should evaluate crypto and other digital assets in the same way they assess any other investment—by considering all relevant facts and circumstances in a context-specific manner.
The 2022 guidance had raised several concerns about crypto in retirement plans.
“At this early stage in the history of cryptocurrencies, the Department has serious concerns about the prudence of a fiduciary’s decision to expose a 401(k) plan’s participants to direct investments in cryptocurrencies, or other products whose value is tied to cryptocurrencies,” the Biden-era guidance stated.
“These investments present significant risks and challenges to participants’ retirement accounts, including significant risks of fraud, theft, and loss.”
At the time, the Labor Department also announced an investigative program targeting plans that offered crypto options.
In contrast, the new position removes that warning language and emphasizes that cryptocurrencies will no longer be singled out for special caution or enforcement. It does not endorse or disapprove of crypto use in 401(k) plans.
The shift comes as the Trump administration signals broader support for cryptocurrency integration across government and financial systems.
Earlier this year, President Donald Trump signed a bill
overturning a Biden-era IRS rule that expanded tax reporting requirements for digital asset transactions. His administration also
announced plans to explore acquiring bitcoin for a national strategic reserve.
Trump’s own media company, Trump Media & Technology Group, has
partnered with Crypto.com to launch exchange-traded funds mixing crypto with U.S.-based equities. Regulators under his administration have
recently permitted banks to engage in select cryptocurrency activities, reversing a policy initiated in 2021 under the previous administration.
The Labor Department’s latest move does not require plans to offer crypto. It removes a regulatory barrier that some in the industry viewed as an implicit ban.
