The U.S. Labor Department (DOL) has released a proposed rule that would allow 401(k) retirement plan accounts to invest in alternative assets such as cryptocurrencies and private equity (PE).

CoinPost, a blockchain media outlet, reported on March 31 local time that the proposal focuses on detailing a safe harbor, or liability protections, and procedures for fulfilling fiduciary duties when plan administrators add alternative assets.

A key point of the proposal is that rather than excluding specific asset classes across the board, the government would put in place institutional safeguards so alternative assets can be included in portfolios if plan administrators have objective review procedures. The Labor Department explained the proposal as intended to broaden investment options in the 401(k) system used by more than 90 million people.

More specifically, it set out review items and processes that can be considered as fulfilling fiduciary responsibilities. Plan administrators would be required to establish a process to check fees, liquidity and transparency in an "objective and analytical" manner. The Labor Department said it believes such standards would allow administrators to build a "modern investment portfolio" while reducing litigation risk.

Messaging within the government also put more weight on "procedural compliance" than on the "superiority" of assets. Keith Sonderling (키스 손더링), an assistant secretary at the Labor Department, stressed that the department's role is not to evaluate individual assets but to take a neutral stance in ensuring thorough and prudent review processes.

The proposal has the character of specifying an executive order related to "democratizing investment opportunities in alternative assets" that U.S. President Donald Trump signed in August last year. Labor Secretary Lori Chavez-DeRemer (로리 차베스-데레머) said the proposal more accurately reflects the current investment environment and helps build a system that contributes to workers retiring with dignity. This is seen as reflecting the current administration's stance of formally rejecting guidance issued by the Biden administration in 2022 that effectively restricted cryptocurrency investment and ending an approach of arbitrarily selecting asset classes.

Other departments also issued welcoming messages. SEC Chair Paul Atkins (폴 앳킨스) issued a statement on the revision, welcoming long-delayed institutional improvements so Americans can benefit from growth and innovation. Treasury Secretary Scott Bessent (스콧 베센트) also assessed the attempt to expand investment opportunities while presupposing protection of retirement assets as a "symbolic step forward toward realizing a golden age for the economy."

Procedurally, a review by the White House's Office of Information and Regulatory Affairs (OIRA) was completed last week, and the item was designated an economically significant regulation, with an expected economic impact of more than $200 million a year. As the possibility is being discussed that the U.S. retirement pension market, worth $13.8 trillion in total including about $1.25 billion within 401(k)s, could open to cryptocurrencies, the proposal is set to move to a public comment stage.