Trump to sign executive order to allow crypto and other private assets into 401(k)s

The order will direct Labor Secretary Lori Chavez-DeRemer to reexamine her department’s guidance on what assets are allowed in retirement accounts. The asset rules are informed by a decades-old law known as the Employee Retirement Income Security Act of 1974, or ERISA, which sets minimum standards for most employer-sponsored retirement and health plans, including 401(k)s.

Trump’s order also will instruct the Department of Labor to work with other federal agencies, including the Treasury and Securities and Exchange Commission, to collaborate on whether the regulators should implement complementary changes to their agencies’ policies.

In addition, the order asks the SEC to allow investors access to alternative assets into retirement plans the agency monitors.

Bloomberg was first to report that the order will be signed on Thursday.

In the last year of Trump’s first term in 2020, the White House directed regulators to evaluate whether alternative assets should be allowed in retirement accounts. That guidance was later rolled back under President Joe Biden.

But, during Trump’s second term, his administration has weighed for months whether and when to reinstate the old guidance.

Thursday’s signing will also be a boon for private equity and other alternative asset managers. It also delivers another victory to the crypto industry, whose ETFs, funds, and other financial products have largely been avoided by traditional retirement fund managers.

Under Trump, his administration has slashed regulatory red tape and opened up the markets for crypto companies, who were large donors to the president’s reelection campaign. He’s signed an executive order to establish a Bitcoin and digital assets reserve. His administration also eliminated the Department of Justice’s crypto enforcement. 

Trump has also pushed Congress to pass two bills to create regulatory frameworks for the industry. Trump has already signed in July one bill, which regulates cryptocurrencies called stablecoins, into law. The House has passed another piece of legislation that regulates crypto markets more broadly. That bill awaits a vote in the Senate. 

Trump’s executive order opening up retirement accounts to alternative assets also potentially benefits his business empire. 

Over the past year, the president and his family have dived headfirst into crypto. Just before his inauguration, the 47th president launched his own memecoin, or cryptocurrency whose value is simply propelled by its ties to a joke or celebrity.

And his two sons, Eric and Donald Jr., have launched a string of crypto ventures, including a Bitcoin mining company and a decentralized finance app.