401(k) could include cryptocurrencies and private equity funds! The U.S. Department of Labor has released a new rules proposal to allow alternative assets in retirement accounts

U.S. Department of Labor (DOL) Employee Benefits Security Administration (EBSA) on March 31 officially published a proposed rule in the Federal Register—“Fiduciary Duties in Selecting Designated Investment Alternatives” (fiduciary duties for beneficiaries when selecting designated investment alternatives). Pursuant to the Employee Retirement Income Security Act of 1974 (ERISA) and Executive Order 14330 signed by President Trump on August 7, 2025, it provides a clear “safe harbor” for fiduciaries of self-directed accounts for participants such as 401(k) plans when selecting investment options that include alternative assets.

This proposed rule means that private equity, cryptocurrency, real estate, infrastructure, commodities, and lifetime income strategies will now have the opportunity to be formally included as retirement-account investment options for the general public in the United States.

Policy shift: from Biden’s “cautious warning” to Trump’s “maximum discretion”

This proposal is an unambiguous policy reversal. During the Biden administration, the DOL revoked, in 2021, the prior guidance from Trump’s first term that had allowed private equity into 401(k) plans, and it also issued multiple secondary regulatory guidance documents warning retirement plans about investing in cryptocurrency on the grounds of risk.

On August 7, 2025, President Trump signed Executive Order 14330, “Democratizing Access to Alternative Assets for 401(k) Investors,” which requires the DOL to reexamine ERISA fiduciary-duty guidance within 180 days (i.e., by February 3, 2026) and to clearly set out the procedures that fiduciaries must follow to include alternative assets. This formal proposed rule is the concrete outcome of that mandate.

Six-factor safe harbor: the fiduciaries’ new discretion framework

The core of the proposal is a safe harbor mechanism based on “procedural fairness.” According to analysis by the law firm Ogletree, if a fiduciary follows the following six factors to conduct an “objective, thorough, and analytical” evaluation, it will be presumed to have satisfied the prudent-fiduciary duty under ERISA Section 404(a)(1)(B):

Performance

Fees

Liquidity

Valuation

Performance Benchmarks

Complexity

As long as fiduciaries make decisions by following the procedures above, courts should grant respect under a “presumed prudent” principle rather than letting litigators determine outcomes after the fact based solely on results. In the proposal, the DOL explicitly criticizes “opportunistic plaintiff attorneys” for excessively interfering with retirement plan decision-making, citing more than 500 fee collective lawsuits over the past 10 years, and more than $1 billion in settlement amounts, as the main root problem.

Asset-class neutrality principle: no listing, no prohibitions

Notably, the proposal adopts an “asset-class neutrality” principle—neither requiring nor prohibiting any specific type of alternative asset, as long as the asset itself is lawful. Under that approach, fiduciaries have the greatest discretion to decide whether to include it. This differs from Executive Order 14330’s approach of listing specific categories such as private equity, private credit, hedge funds, real estate, and commodities; at the rule level, it selects a broader neutral framework.

In addition, the proposal does not apply to single-asset investments for defined benefit plans, nor to brokerage windows or self-directed accounts.

Cryptocurrency formally enters the discussion: a new era for how retirement funds are allocated

Reuters reports that this proposal “paves the way for private equity and cryptocurrency to be included in 401(k) accounts.” Cryptocurrency assets previously were kept out of mainstream retirement plans for the long term due to difficulties in valuation and high volatility. Now, under the safe harbor framework, if fiduciaries can explain that they have conducted an evaluation using the six factors, they may include cryptocurrency assets in the investment lineup under legal protection.

There are about 71 million people in the United States who hold 401(k) accounts, with total assets of more than $10 trillion. Even if only a small portion flows into alternative assets, it could have a far-reaching impact on both the private markets and demand for digital assets.

Next steps: a 60-day public comment period

This is a Proposed Rule, and it is not yet in effect. It will formally open for a 60-day public comment period. Interested parties may go to regulations.gov to search for the rule identification number RIN 1210-AC38 and submit comments. After the comment period ends, the DOL will review and analyze the comments and decide whether and how to adjust the rule before issuing a final determination.

This article “401(k) may include cryptocurrency and private funds! The U.S. Department of Labor releases a new rule proposal, opening alternative assets for retirement accounts” first appeared on Chain News ABMedia.