Trump 401(k) crypto order opens retirement door, 77% of Americans balk

The Trump administration's August 2025 executive order removing barriers to digital assets in retirement plans has produced a draft Labor Department rule, even as 77 percent of Americans view crypto in 401(k)s as risky.

"Americans tell us that retirement security is becoming increasingly difficult to achieve as they struggle with the affordability of daily life," Dan Doonan, executive director of the National Institute on Retirement Security, said. "Housing, healthcare, debt, and other expenses compete with the need to save for retirement."

The NIRS survey, conducted by Greenwald Research among 1,203 Americans between Oct. 24 and Nov. 14, 2025, found 46 percent view crypto as "very risky" and 53 percent oppose employers offering it as an investment option. The Labor Department proposed rules in March 2026 creating a safe harbor for fiduciaries adding alternative assets to plan menus, following the executive order signed Aug. 7, 2025.

The policy shift opens a new distribution channel for Bitcoin and other digital assets through tax-advantaged retirement accounts, with IRA contribution limits at $7,500 for 2026. Crypto custodians including iTrustCapital, Bitcoin IRA, and BitIRA already offer self-directed Bitcoin IRAs with account minimums ranging from $500 to $7,000.

The Regulatory Path

The executive order, titled "Democratizing Access to Alternative Assets for 401(k) Investors," directed the Labor Department and the Securities and Exchange Commission to consider regulatory changes facilitating access to private capital, real estate, and digital assets in defined-contribution plans. The DOL had already rescinded 2022 guidance in May 2025 that urged plan fiduciaries to exercise "extreme care" when considering cryptocurrency investments, returning to a neutral approach.

The March 2026 proposed rule requires fiduciaries to evaluate six criteria when adding alternative assets: performance, fees, liquidity, valuation, benchmark index, and complexity. The proposal has drawn pushback from lawmakers, with Sens. Bernie Sanders and Elizabeth Warren and Rep. Bobby Scott urging the DOL in June to withdraw it, citing crypto's volatility and what they described as insufficient investor safeguards.

The Market Structure Shift

The policy push coincides with a broader migration of retirement assets into vehicles with less regulatory oversight. Collective investment trusts now hold 55 percent of target-date assets versus 45 percent for mutual funds as of June 30, 2026, according to Sway Research, with combined target-date assets reaching $5.3 trillion. State Street Investment Management and Apollo Global Management are building target-date series with direct allocations to private assets.

For the crypto industry, the regulatory easing represents a structural shift in how digital assets reach retail investors. Bitcoin surpassed $100,000 for the first time in 2024, and the ability to hold digital assets inside tax-advantaged retirement accounts could expand the investor base beyond traditional exchanges. Providers such as iTrustCapital charge a 1 percent transaction fee with no monthly fees, while Bitcoin IRA offers FDIC insurance on uninvested cash and up to $250 million in coverage through its wallet partner BitGo.

The Supreme Court will hear Anderson v. Intel Corp. Investment Policy Committee in October, a case that could determine whether plan fiduciaries can be held accountable for opaque investment choices. The Labor Department has filed a brief urging the court to require plaintiffs to plead a "meaningful benchmark" before reaching discovery, a standard critics say would shield fiduciaries from accountability for hard-to-value assets.

This article is for informational purposes only and does not constitute investment advice.