Original Author: KarenZ, Foresight News
On March 30, 2026, the U.S. Department of Labor released a 164-page proposed rule titled "Fiduciary Duties Regarding Selected Designated Investment Alternatives." The core of this document is to formally open the door to alternative assets for the U.S. 401(k) market, which has a volume of over $10 trillion, and digital assets are right behind that door. Simultaneously, the proposed rule also proactively establishes a legal firewall for fiduciaries.
Behind this rule is a complete reversal of the U.S. regulatory stance. In March 2022, the Employee Benefits Security Administration (EBSA) during the Biden administration issued a strongly worded guidance warning: exercise "extreme care" before considering adding cryptocurrency to 401(k) investment options. The document also listed five specific risk reasons: extreme price volatility, participants' lack of judgment, custody and record-keeping risks, questionable valuation methods, and an uncertain regulatory environment.
The implication was: if you add it, we will investigate you.
Three years later, in May 2025, the same department under the Trump administration publicly withdrew this document and replaced it with a completely opposite logic: crypto assets are legitimate alternative investments, fiduciaries can make their own judgments, the government does not endorse, nor does it block.
In August of the same year, Trump signed Executive Order 14330, "Making It Easier for 401(k) Investors to Access Alternative Assets," which included digital assets in the category of alternative assets, alongside private equity, real estate, commodities, and infrastructure financing. The executive order's wording on digital assets was deliberately left with room: it did not allow direct holding of cryptocurrencies, but rather the allocation of actively managed digital asset investment vehicles.
A Fence Trapping $10 Trillion in Funds
To understand why this latest proposed rule is important, one must first understand what kind of fence 401(k) is. 401(k) is the most mainstream employer-sponsored retirement savings plan in the United States, similar to China's enterprise annuity, but much larger. Extended reading: "Is the Pension Booster in Place? How Big is the 401(k) Volume?"
Latest data from the Investment Company Institute shows that as of the end of 2025, the total size of U.S. retirement assets reached $49.1 trillion, accounting for 34% of all U.S. household financial assets. Among them, (Individual Retirement Account) IRAs held another $19.2 trillion, and 401(k) plan assets were $10.1 trillion.
For a long time, this huge sum of money was invested almost exclusively in stocks and bonds. Although the law does not explicitly prohibit alternative assets, over 96% of Defined Contribution (DC) plans like 401(k)s and 403(b)s kept their distance. The core reason is only one: fear of litigation.
Since 2016, there have been over 500 fee-related lawsuits against such plans, with total payouts by plan sponsors in settlements exceeding $1 billion. The rational choice for fiduciaries became:不求有功,但求无过 (Seek no merit, but seek no blame - play it safe).
Safe Harbor: A Shield of Exemption for Fiduciaries
The most substantive change in this new proposed rule is the introduction of a "safe harbor" mechanism.
The logic is simple: since fiduciaries (employers or those designated by employers) are afraid to act for fear of being sued, give them an operating manual. As long as they follow the steps, the court should presume their decision was prudent, and the room for plaintiff lawyers is greatly reduced.
Specifically, the rule requires fiduciaries, when selecting investment options that include alternative assets, to conduct an objective, systematic assessment of six dimensions:
- Performance: Cannot just look at absolute returns, must look at long-term expected returns adjusted for risk (e.g., Sharpe ratio).
- Fees: Alternative assets typically have higher fees; the fiduciary must prove that the higher fees bring超额价值 (superior value) (e.g., excellent risk diversification capabilities).
- Liquidity: Pension accounts need to handle employee loans, withdrawals upon termination, etc. Fiduciaries must ensure the fund has adequate liquidity management solutions.
- Valuation: Must ensure the asset has an independent, conflict-free, timely valuation process (for non-publicly traded assets).
- Benchmarking: Must find a reasonable performance reference for the asset.
- Complexity: The new rule特别强调 (particularly emphasizes) that if the fiduciary does not understand digital assets, then a prudent process requires them to spend money to hire a professional third-party investment advisor.
This framework essentially turns "prudence" from a vague moral standard into a checklist that can be ticked off.
One boundary needs to be clarified. This safe harbor mechanism covers "designated investment alternatives"—investment options screened and formally listed by the plan fiduciary. The原文 (original text) explicitly excludes "self-directed brokerage accounts" from the definition clause: investments chosen by participants themselves through a brokerage window are not within the scope of this rule's safe harbor.
This distinction means: At the level of listed options, crypto assets will not appear in the form of "directly buying Bitcoin." A more realistic path is being packaged into an asset allocation fund—for example, a Target-Date Fund (TDF, which automatically adjusts risk based on the target retirement year) allocating a portion of its仓位 (position) to actively managed funds that invest in digital assets, thus holding exposure indirectly through a组合 (portfolio).
Executive Order 14330's description of digital assets also used this exact structure: "holding actively managed investment vehicles that invest in digital assets."
Not Just a Federal Story
More noteworthy is the spillover effect of this policy shift.
While the federal level is loosening the reins, states are also following suit. On February 25, 2026, the Indiana state legislature passed a bill requiring some state retirement plans to provide access to at least one crypto investment option through a self-directed brokerage account by July 1, 2027. States like Texas, Florida, and Wyoming are also promoting the entry of digital assets into public retirement systems in their own ways.
From the industry side, the Labor Department admitted that for the three beneficiary types—private equity, hedge funds, and digital asset investment institutions—there is currently insufficient data to assess their number and scale, and it has专门开辟 (specially opened) a comment collection channel to gather industry information.
The Labor Department坦承 (acknowledged) in the document that there is currently insufficient data to assess the number and scale of institutions that will market digital asset products to 401(k)s, and it has专门开辟了 (specially opened) a comment collection channel to gather industry information.
When the world's largest pool of long-term capital begins, under the protection of the law, through scientific allocation models, to systematically incorporate cryptocurrency as its underlying asset, it not only意味着 (means) massive inflows of long-term, stable capital but also the彻底确立 (complete establishment) of digital assets within the mainstream social credit system.
Of course, after the rule is published, there will be a 60-day public comment period, after which the Labor Department will revise it based on feedback, then submit it to the White House for approval, before it is finally正式落地 (formally implemented). The entire process could be completed by the end of 2026, or possibly later.
