TheBlock
Sens. Bernie Sanders and Elizabeth Warren, joined by House Education and Workforce ranking Democrat Robert "Bobby" Scott, are pressing the Department of Labor to withdraw a proposed rule that would let 401(k) plan fiduciaries add alternative assets — including cryptocurrencies, private equity, and real estate — to retirement menus. In a June 1 letter to Acting Secretary of Labor Keith Sonderling, the trio argued the rule "would establish a so-called safe harbor for fiduciaries who offer alternative investments in retirement plans," stripping long-standing investor protections and "encouraging the use of more risky, complex, and expensive investments."
Why it matters
The proposed rule was unveiled in March, following President Donald Trump's executive order directing the agency to pave the way for alternative assets inside retirement plans. The letter lands as the DOL's comment window narrows and frames the fight as more than a procedural dispute: it ties crypto access in retirement accounts directly to the Trump family's own crypto exposure, citing a Wall Street Journal report that the family amassed roughly $5 billion in paper wealth after the World Liberty Financial token launch.
Market impact
The lawmakers cited the Trump memecoin's collapse from an all-time high above $73 to roughly $2 as evidence of digital-asset volatility, alongside FBI data showing crypto-linked fraud losses hit a record $11.4 billion in 2025, with seniors bearing a disproportionate share. For asset managers positioning around an eventual safe harbor, the letter raises the political cost of acting before the rule is finalized — and signals that any DOL green light will arrive under sustained congressional scrutiny from the Democrats' top labor and banking voices.
Frequently asked questions
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What did Sanders and Warren ask the Labor Department to do?
They urged the Department of Labor to withdraw its proposed rule that would create a safe harbor for 401(k) fiduciaries offering alternative assets, including cryptocurrencies, in retirement plans.
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When was the proposed 401(k) alternative-asset rule released?
The Department of Labor unveiled the proposed rule in March, after President Donald Trump signed an executive order directing the agency to pave the way for alternative assets in retirement plans.
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What examples did the lawmakers cite against crypto in 401(k)s?
They cited the Trump memecoin's drop from an all-time high above $73 to roughly $2, and an FBI report finding crypto-related fraud losses hit a record $11.4 billion in 2025, with seniors hit hardest.
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What is the Trump family crypto conflict the letter references?
The letter cites a Wall Street Journal report that the Trump family amassed roughly $5 billion in paper wealth following the launch of the World Liberty Financial token.
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What alternative assets does the proposed DOL rule cover?
The rule outlines steps 401(k) plan managers should take when considering private equity, real estate, and digital assets inside retirement plan investment menus.
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