Overview

• President Trump signed an executive order on August 7 directing the Labor Department to allow cryptocurrencies, private equity and real estate in 401(k) retirement plans.
• The order tasks the Labor Department, Treasury Department and SEC with clarifying fiduciary duties and liquidity standards for alternative asset offerings.
• Bitcoin rallied more than 2 percent to about $117,000 as traders speculated that up to $12.5 trillion in retirement savings could flow into new asset classes.
• Asset managers and legal experts expect a phased adoption pending detailed rulemaking and foresee potential litigation over suitability, valuation and disclosure.
• Critics warn that including speculative, illiquid investments may burden savers with higher fees and expose plan sponsors to heightened legal risk.