The executive order by President Trump on August 7, 2025, allowing Bitcoin and crypto in 401(k)s marks a significant shift, building on a 2022 trend where some retirement plans began offering crypto options, despite concerns from the U.S. GAO about high-risk investments lacking full regulatory oversight.
This move aligns with growing institutional interest, as seen with Morgan Stanley's $458 million investment in Grayscale Bitcoin Trust by 2022, and could accelerate crypto adoption, though peer-reviewed studies like those from the Journal of Financial Economics (2023) highlight volatility risks that may impact long-term retirement savings.
The decision challenges mainstream financial caution, as the Department of Laborโs limited data collection on small 401(k) plans (under 100 participants) may obscure potential risks, prompting calls for stricter fiduciary accountability in light of this policy change.
