Apr 16, 2026
Private equity is giving 2008 vibes (1). Private credit is in crisis. Some are calling the end of the crypto honeymoon, with its trading volume drop (2) the lowest since 2023. All the while, Trump wants all of these assets to be added into 401(k).
In response to the self-proclaimed crypto president's August 2025 executive order, the Labor Department has proposed a rule that would make way for alternative assets into 401(k)s — a retirement plan that's nearly half a century old.
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Trump says the more than 90 million Americans (3) who participate in employer-sponsored defined-contribution plans are missing out on the potential growth and diversification opportunities.
But in reality, the expansion of assets is stirring up murky waters for employers.
The rule, according to the New York Times (4) article, does not grant employers absolute immunity from lawsuits. Plan sponsors to evaluate investment products on six criteria — performance, fees, liquidity, valuation, benchmarking and complexity — to have fulfilled fiduciary duty, but this can be challenged.
Experts weigh the risks
Senator Elizabeth Warren, Democrat of Massachusetts, who has been a loud crypto critic over the years, advised against the rule. "As cracks emerge in the private credit market, private equity returns fall to 16-year lows, and crypto keeps tumbling, President Trump has decided now is the time to stick all of these risky assets into Americans' 401(k)s," she said in an official statement (5).
Warren warned that Americans should be more cautious with retirement savings right now. It's not the time or vehicle to be experimental.
Wojciech Kazsycki is Chief Strategy Officer of BTCS S.A., a Warsaw-based public company listed on NewConnect and the Frankfurt Open Market, that specializes in a Digital Assets Treasury model. Kazsycki told Moneywise he's not against access, he's against mismatch.
"A 401(k) is supposed to be simple, long-term, and understandable. Private markets are illiquid, crypto is highly volatile, and most savers are not equipped to underwrite either properly."
"What could go wrong? Higher fees, harder-to-understand risk, weaker liquidity, and a lot of people discovering too late that 'alternative' does not mean 'appropriate' for retirement," he added.
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The CSO's stance is this: retirement accounts should prioritize clarity, liquidity, and discipline.
Private equity and crypto may have a place for sophisticated investors, but that does not automatically make them suitable building blocks for mass-market retirement products.
The danger is that access expands faster than understanding. Comments (6) on the rule are open before June 1, 2026.
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It's healthy to be skeptical
Even if embraced, nothing will happen fast. And even then, alternative assets would be added in with traditional stocks and bonds. While the directive will come from the department and laws, it's worthwhile brushing up on how these plans work, if and how it might impact you, and what the current legislation says.
Josh Brown, CEO of Ritholtz Wealth Management, told CNBC (7) that "the average investor does not need alternative assets in their portfolio."
Maybe diversification doesn't need to happen within 401ks, but rather, an individual's broader financial ecosystem. It's worth a sit-down with your financial planner, while you wait for this to develop. If it does.
Article Sources
We rely only on vetted sources and credible third-party reporting. For details, see our ethics and guidelines.
Bloomberg (1); CoinDesk (2); The White House (3); The New York Times (4); U.S. Senate Committee on Banking (5); Federal Register (6); CNBC (7)
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Amanda Smith is a freelance journalist and writer. She reports on culture/society, technology, and health. Her ability to hold a mirror up to society, to see both the malaise and majesty, has led to assignments with highly respected titles such as The Guardian, Business Insider, MIT Tech Review, and National Geographic.
