Trump's resolved stance: Pension funds to adopt Bitcoin - a major surge for the cryptocurrency market is imminent
In a significant move, President Trump has signed an executive order titled "Democratizing Access for 401(k) Investors" on August 7, 2025. This order aims to expand investment choices for Americans saving for retirement by facilitating access to alternative assets, including cryptocurrencies like Bitcoin and Ethereum.
The order instructs federal agencies to update rules and guidance to allow these assets to be offered as investment options in 401(k) and other defined-contribution retirement plans. The Department of Labor is expected to significantly overhaul the rules of the Employee Retirement Income Security Act (ERISA) in coordination with the Department of the Treasury and the SEC.
This policy shift marks a radical departure from the previous administration under President Biden, who had advised against including cryptocurrencies in pension plans. The regulatory headwind for cryptocurrencies is set to end with this move, potentially opening the door for billions of dollars to flow into the crypto market in the coming years.
The new administration accuses former officials of acting biased and putting their thumb on the scale to hinder digital assets. The scale of this move is enormous, with around $12.5 trillion currently sitting in U.S. 401(k) plans.
The order aims to provide pension plan managers with clear rules on how to safely offer cryptocurrencies to their customers. Financial products like the Bitcoin Direct ETP and Ethereum Direct ETP from NxtAssets offer a simple way for investors to invest in Bitcoin or Ethereum without creating a wallet. Bitcoin ETFs could become a simple and direct vehicle for savers to invest in the digital currency.
However, the implementation will be gradual. Many 401(k) providers are cautious due to concerns about volatility, costs, and potential legal risks. Some major providers emphasize the need for investor education on the risks and opportunities of alternative assets, including cryptocurrencies. While alternative assets could diversify portfolios and enhance returns for investors with the right risk tolerance and long-term outlook, index funds remain recommended for most average investors.
It is important to note that the publisher Boerse Medien AG has a conflict of interest, as its management and majority shareholder, Mr. Bernd Foerstch, has entered positions in financial instruments related to the publication.
In summary, the executive order is currently in the early stages of influencing regulatory changes to permit cryptocurrencies in retirement plans, but widespread availability and adoption by 401(k) providers will take time as guidance evolves and fiduciaries adjust to new rules. This move, however, has the potential to unlock significant value for the crypto market, with Bitcoin alone having billion-dollar potential due to this policy change.
This executive order could significantly impact the finance sector by introducing cryptocurrencies as investment options in retirement plans like 401(k), thereby reshaping individuals' lifestyle choices for their future. The technology behind these digital assets, such as Bitcoin and Ethereum, could potentially transform the investment landscape in the United States, opening doors for innovative investment opportunities.