Trump to allow crypto in 401(k) plans: what does this mean for Bitcoin and crypto?

The White House has confirmed plans to allow cryptocurrencies and other alternative assets in 401(k) retirement accounts through an upcoming executive order by President Donald Trump.

According to a press release shared with the media, the long-awaited directive will instruct the US Department of Labor to reassess existing restrictions on defined-contribution retirement plans.

The executive order is expected to cover digital assets, private equity, real estate, and gold, giving Americans more options on how they can structure their retirement savings.

Media reports suggest that the order will direct the Labor Secretary to clarify the department’s position on including alternative assets in 401(k) plans and issue fresh guidance on fiduciary standards.

Among other key issues, the Department of Labor, in coordination with the Treasury Department and the Securities and Exchange Commission (SEC), will also explore potential regulatory updates to support this move

The administration intends to ease legal barriers that have historically prevented everyday savers from allocating a portion of their retirement funds into higher-risk assets like Bitcoin.

What does this mean for the crypto industry?

Once enacted, the executive order could grant retirement savers access to cryptocurrencies within the $12.5 trillion 401(k) market

Retirement accounts have long been the missing piece in crypto’s push into mainstream finance.

Regulatory red tape and legal uncertainty kept most providers away, leaving a $12.5 trillion market untouched by digital assets.

The implications for the crypto space are significant. Institutional investors have already started integrating digital assets into portfolios, but retail exposure through regulated retirement accounts has remained limited

For Bitcoin in particular, the move could drive considerable demand.

As one of the most established digital assets, even a modest reallocation from traditional retirement portfolios could impact BTC’s price and market presence

The directive also aligns with growing sentiment that digital assets deserve a place alongside traditional investments like stocks and bonds.

Long time coming

Signs that the market was ready for crypto in retirement plans emerged long before federal regulators acted.

Back in 2022, Fidelity opened the door with its Digital Assets Account, which let savers invest in Bitcoin through their 401(k)s.

At the time, Fidelity partnered with MicroStrategy (now Strategy) and reported strong interest from employers seeking to expand investment options.

According to Fidelity’s 2021 institutional survey, nearly 30% of US institutional investors showed interest in digital asset-based retirement products, and over 80 million Americans had already engaged with cryptocurrencies in some form at the time.

However, that early momentum quickly ran into resistance from Washington.

Not long after Fidelity’s 401(k) crypto plans made headlines, the Department of Labor under the Biden administration stepped in with a sharp rebuke

The agency warned that fiduciaries must show extreme caution if they offer digital assets in 401(k) plans.

It pointed to crypto’s price swings and unclear regulations as major concerns.

The 2022 guidance didn’t prohibit fiduciaries from offering crypto in 401(k) plans, but it created enough uncertainty to stall adoption

The Department of Labor warned that fiduciaries could face regulatory scrutiny if they added digital assets to retirement portfolios.

It made clear that offering crypto could raise questions about whether plan managers were meeting their duties under ERISA.

This abrupt policy turn forced many employers to shelve digital asset options before they even got started.

Even Fidelity, with its institutional-grade custody infrastructure and established risk disclosures, saw limited adoption.

The Trump card

Fast forward to 2025, and that stance has begun to change under a pro-crypto administration led by Trump.

In May, the Department of Labor quietly rolled back the 2022 directive

The agency issued a new compliance release, this time, reaffirming a neutral stance.

It acknowledged that the earlier language departed from long-standing ERISA standards and unfairly targeted one category of assets.

“The Biden administration’s Department of Labor made a choice to put their thumb on the scale. We’re rolling back this overreach.” Labor Secretary Lori Chavez-DeRemer said at the time.

And now, with the Trump administration’s executive order in the pipeline, Washington is changing gears from neutral to proactive

For crypto firms, this is a long-awaited opening. The 401(k) market represents trillions in long-term capital, and even a fraction flowing into digital assets could mark a structural change in demand.

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