DOL Files Crypto-in-401(k) Proposal With White House for Review

The Department of Labor filed a proposed rule on Thursday that would open 401(k) retirement accounts to alternative assets, including cryptocurrencies, sending it to the White House for regulatory review. The proposal landed at the Office of Information and Regulatory Affairs (OIRA), the division within the Office of Management and Budget that examines federal regulations before publication.

The filing advances an executive order from President Donald Trump that directed the department to pave the way for including alternative assets in 401(k) plans. In the filing, the DOL set out how plan fiduciaries should weigh such investments once permitted.

"Such clarification must aim to identify the criteria that fiduciaries should use to prudently balance potentially higher expenses against the objectives of seeking greater long-term net returns and broader diversification of investments," the DOL said in its filing.

What does the rule change?

The proposal builds on an initial rule the DOL unveiled months ago, which outlined steps 401(k) plan managers should take when considering alternative assets such as digital assets and private equity for their investment profiles. Trump directed the department to draft that framework through his executive order.

The department has already reversed course on a key piece of prior guidance. Under the Biden administration, the DOL had discouraged retirement managers from considering crypto as a 401(k) investment option, citing concerns about the asset class in retirement plans. The current department withdrew that stance, clearing the procedural ground for Thursday's filing.

If finalized, the rule would mark a structural shift for the roughly $8 trillion defined-contribution market's largest vehicle, the 401(k), by letting plan sponsors add digital assets alongside conventional stock and bond menus. The operational burden would fall on fiduciaries, who must document how higher expenses and volatility trade off against diversification goals.

Who is opposing it?

The proposal has drawn scrutiny on Capitol Hill. Earlier this year, Senators Bernie Sanders and Elizabeth Warren pushed the DOL to scrap the rule, arguing it would expose investors to volatile assets, including crypto.

The opposition signals likely friction during any public comment period once OIRA completes its review and the rule moves toward publication.

What comes next?

The immediate milestone is procedural. OIRA review typically involves meetings with stakeholders and interagency comment before a rule is published in the Federal Register, after which a comment window opens.

Notably, the DOL disclosed in Thursday's filing that it was still considering the costs of the proposal when describing its costs and benefits. That gap leaves the department's own economic justification incomplete as the rule enters White House review, and any final timeline depends on how quickly the DOL closes that analysis and clears the OIRA process.