Labor Department Rescinds 401(k) Crypto Guidance

The US Department of Labor officially withdrew its 2022 guidance on May 28, 2025, rescinding the earlier advised caution against cryptocurrency options in 401(k) plans.

The decision signifies a significant policy shift under the Trump administration, potentially affecting retirement plan investments and the broader cryptocurrency market.

Policy Reversal by the US Department of Labor

The US Department of Labor’s Employee Benefits Security Administration has retracted guidance that cautioned against cryptocurrency investment in retirement plans. Compliance Assistance Release No. 2025-01 documents this shift, reflecting the Trump administration’s policy changes.

The Labor Department’s neutral stance offers retirement plan fiduciaries more flexibility in offering cryptocurrency. It opens opportunities for retirement account holders to see diverse crypto investment options. This change might impact major cryptocurrencies and boost their market potential.

“This new position states that it is ‘neither endorsing, nor disapproving of’ employers who opt to add cryptocurrency to their 401(k) investment offerings.” — U.S. Department of Labor, Employee Benefits Security Administration

With this policy reversal, retirement plan administrators may incorporate cryptocurrencies like Bitcoin and Ethereum, marking a shift from previous discouragement. The earlier guidance had cited risks such as fraud and theft related to crypto investments.

Experts suggest this regulatory shift aligns with broader adoption trends under the Trump administration. The move could usher in greater institutional adoption of digital assets within traditional retirement structures.

The broader implications of this decision could result in more integrated approaches towards cryptocurrencies in retirement planning. Observers will keenly watch how this affects the balance between investment opportunities and associated risks over time.