Lawmakers and investor advocates are ringing alarms over the idea of allowing cryptocurrency into 401(k) and other retirement plans, especially after a turbulent month that saw some projects implode and other cryptocurrencies go into free fall.
The debate kicked off in March when the Labor Department posted a compliance release that said those in charge of 401(k) retirement plans should “exercise extreme care” when contemplating adding cryptocurrencies to investment options. A month later, one of the largest financial service providers, Fidelity Investments, said it would offer the option to invest part of 401(k) plans in bitcoin.
ForUsAll, a 401(k) provider, sued the Labor Department this month, saying the warning violated the law that governs how federal agencies develop and issue rules. The California-based company said the department has no legal authority or existing precedent and said its guidance was issued suddenly and without public comment.
