The Labor Department today rescinded a 2022 compliance release that directed fiduciaries to exercise “extreme care” before adding a cryptocurrency option to a 401(k) plan’s investment menu for plan participants.
The 2022 guidance reflected the Biden administration’s wariness of the crypto industry. The American Bankers Association and other groups advocated for the withdrawal of the document. While ABA has no view on the appropriateness of crypto as a retirement plan investment, the association argued the Labor Department failed to make the guidance available for public comment and review before adopting it, as required by law.
In its decision to rescind the guidance, the Labor Department said it has usually articulated a neutral approach to particular investment types and strategies. “Today’s release restores the department’s historical approach by neither endorsing, nor disapproving of, plan fiduciaries who conclude that the inclusion of cryptocurrency in a plan’s investment menu is appropriate,” it said.
