Sens. Bernie Sanders and Elizabeth Warren are pressing the Department of Labor to strike down a proposed rule that would open up 401(k) retirement plans to alternative assets, including cryptocurrencies.
In a letter dated June 1 to Acting Secretary of Labor Keith Sonderling, the senators and top Democrat of the House Committee on Education and Workforce, Rep. Robert "Bobby" Scott, said the proposed rule would expose people to more risk.
"The proposed rule would establish a so-called safe harbor for fiduciaries who offer alternative investments in retirement plans," they said in the letter. "This would strip long-held investor protections from retirement savers and encourage the use of more risky, complex, and expensive investments."
In March, the Department of Labor unveiled the proposed rule outlining steps 401(k) plan managers should take when considering incorporating alternative assets into their investment portfolios, including private equity, real estate, and digital assets. That came after President Donald Trump directed the agency in an executive order to pave the way for the inclusion of alternative assets in those retirement plans.
The lawmakers' criticism spans several categories of alternative assets. The trio of lawmakers also raised concerns about digital assets' volatility, citing Trump's own memecoin, which hit an all-time high of over $73 but has since fallen to closer to $2 as of Tuesday, according to The Block's price page.
