Donald Trump continues to embrace cryptocurrencies | Credit: cryptostock/Shutterstock
On Thursday, August 7th, President Donald Trump signed a highly anticipated executive order that aims to allow private equity, real estate, cryptocurrency, and other alternative assets in 401(k) retirement accounts, according to Reuters.
The details of the directive remain under wraps, Reuters added, but sources familiar with the matter told Bloomberg that the order would direct the Department of Labour to raise specific fiduciary restrictions that currently undermine plan administrators from offering such offerings.
While several financial sectors expressed enthusiasm over Trump’s order, others spoke of concerns about including cryptocurrencies in retirement plans at the tail end of 2024, with the Department of Labour reportedly “lacking the data” to oversee the growing prevalence of crypto holdings.
Bitcoin rose to over $117,492.28 from $114,900 within the hour of the announcement, as traders interpreted the news as bullish for long-term crypto adoption, Coindesk said.
Though still shy of the psychological $120,000 level it briefly hit in July, the rally reignited speculative momentum, with derivatives markets also showing a jump in open interest and volume, the crypto news outlet added.
Following Trump’s signing, the White House released a summary of the order, in which it states that “the Securities and Exchange Commission must consider ways to facilitate access to alternative asset investments by participants in defined-contribution retirement plans.”
Any easing of access to volatile assets such as cryptocurrencies to be included in 401(k)s would be Trump’s latest embrace of digital assets, and could be a potential boon for the sector, including global asset managers that operate crypto exchange-traded funds, such as BlackRock and Fidelity.
“Bitcoin has moved beyond its early days as a merely speculative asset and is slowly entering into many investors’ long-term investment strategy,” said Gerry O’Shea, head of global market insights at Hashdex Asset Management. “This EO will help accelerate this trend.”
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