Trump Administration Expands 401(k) Investment Options to Include Cryptocurrency and Alternative Assets

On August 7, 2025, President Donald Trump signed a landmark executive order titled “Democratizing Access for 401(k) Investors,” which aims to broaden the range of investment options available to American workers saving for retirement through defined contribution plans like 401(k)s. This executive order facilitates access to alternative assets — including cryptocurrency, private equity, and real estate — in retirement accounts, marking a significant shift in U.S. retirement policy.

The new policy reflects the Trump administration’s belief that every American preparing for retirement should have the opportunity to invest in assets that traditionally have been reserved for institutional investors, government workers with public pensions, and high-net-worth individuals. While more than 90 million workers participate in employer-sponsored defined contribution plans, most currently lack access to alternative investments that could enhance returns and diversify their portfolio risks.

Key Components of the Executive Order

• Expanded Access to Alternative Assets: The order encourages plan sponsors and fiduciaries to consider including cryptocurrency, private equity, real estate, and other alternative investments in 401(k) and other defined contribution retirement plans when fiduciaries determine these options can improve the risk-adjusted returns for participants.
• Regulatory Review and Cooperation: The Executive Order directs the U.S. Department of Labor (DOL) to reexamine and potentially update its guidance related to fiduciary duties under the Employee Retirement Income Security Act of 1974 (ERISA) concerning alternative asset investments. It calls for the DOL to explore creating fiduciary “safe harbor” rules aimed at minimizing litigation risks for plan fiduciaries who prudently offer alternative assets.
• Interagency Collaboration: The Order requires cooperation between the Department of Labor, the Treasury Secretary, the Securities and Exchange Commission (SEC), and other federal regulators to ensure consistent and supportive regulatory frameworks. The SEC is particularly tasked with facilitating access to alternative assets by revising relevant regulations and guidance regarding investor qualifications and plan participant access.

Rationale and Expected Impact

The Trump administration argues that alternative assets, including cryptocurrency, offer competitive returns and diversification benefits that are increasingly essential for retirement portfolios in today’s complex financial markets. Public pension and defined benefit plans have already incorporated significant allocations to these assets, but most private sector defined contribution plans have been limited by regulatory barriers and concerns over fiduciary liability.

By reducing what the administration views as regulatory overreach and addressing the deterrent of burdensome lawsuits against fiduciaries, the policy aims to unlock these investment opportunities for over 90 million Americans participating in 401(k) plans. The goal is to democratize access, enabling workers to build more robust retirement savings and improve their financial security.

Implementation and Industry Response

The administration has begun swift implementation efforts following the executive order’s signing. Federal agencies are collaborating to align policies that will enable the introduction of alternative asset investment options within existing retirement plans. Industry experts note this policy could fundamentally reshape Americans’ retirement investing by integrating previously off-limits asset categories.

Fiduciaries and plan sponsors are encouraged to educate themselves on alternative asset investment mechanisms and remain attentive to regulatory updates. The administration’s initiative also signals potential new legislative consideration aimed at expanding private market access in retirement savings.

Conclusion

President Trump’s executive order represents a historic step toward expanding Americans’ retirement investment choices by incorporating cryptocurrency and other alternative assets into 401(k) plans. This policy could offer participants greater diversification, potential for enhanced returns, and a retirement savings landscape more aligned with modern investment strategies, contingent on careful fiduciary oversight and regulatory guidance.