The Department of Labor has expressed “serious concerns” about Fidelity Investments’ attempt to allow customers to accumulate bitcoin in their 401(k) retirement savings accounts. The Wall Street Journal writes about it.
On April 29, officials will discuss this issue with representatives of the financial institution.
Three days ago, Fidelity announced that the option will be available in the summer of 2022. Employees of 23,000 companies will be able to use their $2.7 trillion pension plans with the approval of the employers who entrusted the management to the company. Bitcoin’s share in the portfolio will be limited to 20%.
MicroStrategy CEO Michael Saylor has already taken an interest in the company’s offer. In an interview with CNBC, he described the first cryptocurrency as a less risky asset compared to bonds, stocks, commercial real estate and gold.
“A lot of hype has risen around Bitcoin”Ali Khawar, Acting Secretary of the Employee Retirement Department of the U.S. Department of Labor, said.
The official is concerned about bitcoin’s inherent volatility and the associated risks for ordinary Americans. Khavar stressed that the agency does not ban cryptocurrencies on 401(k) accounts.
“If employers believe the agency has taken their concerns into account, – it’s their decision”added.
On April 10, the U.S. Department of Labor warned employers that it could ask employers if such plans meet the criteria for due diligence and loyalty. Industry members, including Fidelity, have called for the guideline to be withdrawn.
In response to an April 28 statement, the company said its proposal to add bitcoin to retirement accounts “…reflects the view that digital assets will represent a large part of the future of the financial industry.”
Recall that in November 2019, Fidelity Investments launched a crypto custody service focused on institutions.
In 2020, the first cryptocurrency investment retirement plans were introduced in the US by DAiM and Bitwage with Gemini.
Source: Fork Log
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