The U.S. Department of Labor has proposed a rule that could open 401(k) plans to alternative investments like cryptocurrency, private equity and real estate.
The move follows an August executive order from former President Donald Trump directing regulators to expand access to digital assets in retirement portfolios.
Labor Secretary Lori Chavez-DeRemer said the proposal reflects how Americans already invest outside retirement accounts. If finalized, it would mark a major shift from traditional stock-and-bond-focused 401(k)s.
Critics including Senator Elizabeth Warren warn the plan exposes workers to high fees, volatility and potential fraud. Warren called it a risky play benefiting Wall Street at the expense of average savers.
Proponents argue greater diversification can boost long-term returns. Even a 1% allocation from large 401(k) plans could inject billions into crypto markets.