Crypto in retirement plans: what changed for 401(k)s and pensions

A plan sponsor asking whether a 401(k) menu may include crypto will hear three answers: no, because of a 2022 warning; yes, because of a 2025 executive order; and it depends. The third is the accurate one. The warning has been withdrawn, the order gave instructions to agencies rather than changing the statute, and the rule meant to turn the order into something a fiduciary can rely on is still a proposal.

A warning issued, then withdrawn

On 10 March 2022 the Department of Labor's Employee Benefits Security Administration (EBSA) issued Compliance Assistance Release 2022-01. It cautioned plan fiduciaries "to exercise extreme care before they consider adding a cryptocurrency option to a 401(k) plan's investment menu". It set out five concerns: speculative and volatile investments, the difficulty for participants of making informed decisions, custody and record-keeping, valuation, and an evolving regulatory environment.

On 28 May 2025 Compliance Assistance Release 2025-01 rescinded it. The replacement is not an endorsement. The Department said it was restoring its historical approach, which it describes as neutral towards particular investment types, "neither endorsing, nor disapproving of, plan fiduciaries who conclude that the inclusion of cryptocurrency in a plan's investment menu is appropriate". A fiduciary's decision should consider all relevant facts and circumstances. Withdrawing a warning removes a presumption. It does not create a permission, and the statute underneath has not moved.

The August 2025 order and the March 2026 proposal

Executive Order 14330, "Democratizing Access to Alternative Assets for 401(k) Investors", was signed on 7 August 2025 and published in the Federal Register on 12 August 2025. It gives the Secretary of Labor 180 days to reexamine the Department's guidance on fiduciary duties when a plan offers an asset allocation fund that includes alternative assets, and to clarify the Department's position, including through rules that may contain "appropriately calibrated safe harbors". It directs the Securities and Exchange Commission to consider ways to facilitate access, which may include revising its rules on accredited investor and qualified purchaser status. Digital assets are on its list, in narrow words: "holdings in actively managed investment vehicles that are investing in digital assets". An order binds the executive branch. It does not oblige a plan to offer anything, and it does not change what ERISA requires.

Two Labor Department steps followed. According to the preamble of the later proposal, the Department rescinded its December 2021 supplemental statement on private equity on 12 August 2025. Then, on 31 March 2026, EBSA published a proposed rule, "Fiduciary Duties in Selecting Designated Investment Alternatives" (91 FR 16088, RIN 1210-AC38), which states that it implements section 3(c) of the order. Comments closed on 1 June 2026.

The design is a process-based safe harbor. Where a fiduciary "objectively, thoroughly, and analytically" considers and makes determinations on a non-exhaustive list of six factors, its judgement on them would be presumed to meet the duty of prudence and would be "entitled to significant deference". The factors are performance, fees, liquidity, valuation, benchmarking and complexity. Four features matter for crypto:

• The Department chose not to limit the rule to funds containing alternatives. It applies to any designated investment alternative, and the preamble describes the Department's approach as neutral between investment types.
• Paragraph (c) says the prudence provision, section 404(a)(1)(B), "does not require or restrict any specific type of designated investment alternative", and lists holdings in actively managed vehicles investing in digital assets among the examples for which there is no per se rule. The rule is permissive, not a mandate.
• The complexity factor asks whether the fiduciary has the skills, knowledge, experience and capacity to understand the investment, or must seek help from a qualified investment advice fiduciary, investment manager or other individual.
• Paragraph (m)(2) excludes brokerage windows, self-directed brokerage accounts and similar arrangements from the definition of a designated investment alternative. The preamble says fiduciary principles may apply somewhat differently to them. The proposed safe harbor, as drafted, does not cover them.

The stated aim is to reduce litigation risk. The preamble cites an industry letter alleging that plaintiffs' attorneys filed more than 500 ERISA "fee cases" from 2016 through 2024, and says a fiduciary that follows the process "should be able to confidently rely on that determination without undue fear of litigation".

Timing is worth noting. 180 days from 7 August 2025 is 3 February 2026; the proposal appeared eight weeks after that. As of 29 September 2026, the Federal Register listed the March proposal and no final rule. On the SEC side, a search of the Federal Register on the same date showed no final rule revising the accredited investor definition since the order, and this post does not treat one as having happened.

What ERISA still requires

Section 404(a)(1) of ERISA, codified at 29 U.S.C. 1104(a)(1), sets four duties. A fiduciary must act for the exclusive purpose of providing benefits and defraying reasonable plan expenses; with the "care, skill, prudence, and diligence" of a prudent person familiar with such matters; by diversifying so as to minimise the risk of large losses unless it is clearly prudent not to; and in accordance with the plan documents. None of that was amended by the order or the 2025 release.

The six proposed factors are those duties put into questions a committee can minute. Liquidity: can a daily-valued plan meet redemptions and rebalancing from an asset that trades across many venues? Valuation: whose price, at what time? Complexity: who on the committee can read a custody agreement? The mechanics behind a spot product are set out in our explanation of creation and redemption, and the questions a fiduciary would put to a manager on custody and valuation are in our note on operational due diligence.

Here is the inconvenient part. A proposed safe harbor protects no one today. Until a rule is final, a committee that adds crypto is relying on the statute and a documented process. The proposal's promise of deference is a statement of intent about a rule that does not yet exist. This is a description of public texts, not legal, tax, accounting or investment advice; a plan's counsel should read the primary documents.

What sponsors and record-keepers have done

This is the thinnest part of the evidence, and it is better said plainly. We could not retrieve a dated primary source showing which large record-keepers offer crypto to plan sponsors today, or any count of sponsors that have added it.

One example, labelled as vendor material: ForUsAll's "Self-Directed Crypto Window" page, as retrieved on 29 September 2026, lists bitcoin, ether, USDC, Polkadot, Solana and Cardano, lets participants move up to 5% of a 401(k) balance and direct up to 5% of contributions, and says assets are held at Coinbase Custody. The point is the shape of the product: a capped, self-directed window beside the core menu, not a fund on it. If an arrangement like this is treated as a brokerage window or similar, the March proposal's safe harbor would not reach it. We have no independent figure on take-up.

What pension funds have disclosed

ERISA's fiduciary rules do not govern state and local government plans: 29 U.S.C. 1003(b)(1) excludes governmental plans from Title I. The 2022 release and its withdrawal never applied to them. Their limits come from state law and their own investment policies, and the best public evidence of what they hold is the SEC Form 13F that large managers file each quarter. A 13F lists long positions in 13(f) securities, largely US-listed shares and funds, at quarter end. It shows what was held, not why, and a direct holding of a token would not appear on it.

Two examples from EDGAR:

• The State of Wisconsin Investment Board's filing for 31 December 2024, filed 14 February 2025, lists 6,060,351 shares of the iShares Bitcoin Trust with a reported value of $321,501,621. That line does not appear in its filing for 31 March 2025, filed 15 May 2025, or in any filing since, up to the one filed 14 August 2026. That latest filing lists crypto-related equities, including Coinbase, Strategy and Riot Platforms. Our piece on allocation covers how allocators size and measure such positions.
• The State of Michigan Retirement System's filing for 30 June 2026, filed 30 July 2026, lists 300,000 shares of the ARK 21Shares Bitcoin ETF (reported value $5,838,000), 37,418 shares of the Grayscale Bitcoin Trust ETF ($1,703,267) and 460,000 shares of a Grayscale Ethereum staking ETF ($5,869,600). Its filings show a bitcoin ETF and a Grayscale Ethereum position in every report from 30 September 2024 onward.

Two public funds, then, moving in different directions. Wisconsin reported a nine-figure position at the end of 2024 and none at the end of the next quarter. Michigan reports three products, each worth single-digit millions of dollars. Two funds are an anecdote, not a trend, and this is not a survey of defined-benefit plans.

Outside the United States

For a United Kingdom occupational trust scheme, the constraint is trust law and regulation rather than a fiduciary safe harbor. Regulation 4 of the Occupational Pension Schemes (Investment) Regulations 2005 requires assets to be invested in the best interests of members and beneficiaries, with investment powers exercised to ensure the security, quality, liquidity and profitability of the portfolio as a whole. Assets must consist predominantly of investments admitted to trading on regulated markets, those that are not must be kept to a prudent level, and the portfolio must be properly diversified. Trustees must also maintain a written statement of investment principles, under section 35 of the Pensions Act 1995 as substituted by section 244 of the Pensions Act 2004.

The recent change is on the retail side. The Financial Conduct Authority lifted its ban on retail access to crypto exchange-traded notes from 8 October 2025, for notes traded on a UK recognised investment exchange, with financial promotion rules and the Consumer Duty applying and no Financial Services Compensation Scheme cover. The ban on retail cryptoasset derivatives remains. The FCA's press release, first published 1 August 2025 and updated 6 February 2026, does not mention pensions. What a trustee may hold is therefore still answered by the 2005 regulations and the scheme's own principles. For the product side, see our note on European crypto ETPs.

We did not find a documented statement on cryptoassets from The Pensions Regulator, or a comparable position from another jurisdiction, in the sources we retrieved, so none is described here.

What is still open

• Whether the March 2026 proposal is finalised, and in what form. The Federal Register showed no final rule as of 29 September 2026.
• Whether the order's phrase "actively managed" is read to reach passive spot products. The proposal's paragraph (c) names actively managed vehicles as an example and says the statute does not restrict any type, but does not discuss passive crypto products separately.
• Whether courts will give a safe harbor the deference it describes.
• How many sponsors and record-keepers will act, and at what allocation cap. No dated primary source we could reach answers this.

The 2022 release was a warning that the regulator later withdrew; the 2026 proposal is a process that the regulator has not yet adopted. For a general counsel or chief financial officer the working position is unchanged from either date: the duty is prudence, the evidence is the file, and the file has to exist before the decision.