Last Wednesday ( 6/15/2022) when speaking to the House committee Secretary of Labor Marty Walsh stated the DOL is open to a rule that would regulate cryptocurrency in retirement accounts. “We’re looking at potentially going through a rulemaking process moving forward on the industry as a whole, “ Walsh said.
Walsh did not detail what the rules would be.
“We made a recommendation because we were concerned about employees having 20% of their retirement savings put in cryptocurrency,” Walsh said. “Our role is to make sure that we’re protecting the rights of American workers and the investments going in.”
Then on Thursday House Ways & Means Committee Chairman Rep. Richard Neal (D-MA) stated “Recent announcements from major DC plan providers indicate that many employers who sponsor DC plans will have the option to allow their employees to invest in cryptocurrencies,” wrote Neal. “However, concerns have arisen about the risks to older Americans’ retirement security of using retirement accounts to invest in cryptocurrencies due to their volatility and limited oversight.”
Neal asked GAO to examine the following issues:
- Determine the extent to which investment options for cryptocurrency are being offered by firms with a listing of the types of firms, for instance by size, offering the options and the extent to which the investment options for cryptocurrency are being utilized by sponsors of 401(k) plans including solo 401k plans.
- Describe how DC plans administer cryptocurrency investment options, such as determining their valuation, the types and levels of fees associated with them, and safeguards, if any, that plan fiduciaries report using to maintain their fiduciary obligations to participants and beneficiaries.
- Assess the oversight of cryptocurrency investment options in 401(k) plans by the relevant agencies, and guidance federal agencies provide to plan sponsors, participants and beneficiaries about investing in cryptocurrency and examine the current restrictions, if any, on investments in cryptocurrency in 401(k) plans.