[Correction: In the second paragraph, the letter from lawmakers was dated Monday, June 1.]
Top Democrats on three House and Senate committees called on the US Labor Department to halt its plans to allow digital assets and “alternative assets” to be held in Americans’ retirement plans.
In a Monday letter, Senator Bernie Sanders, Senator Elizabeth Warren and Representative Bobby Scott asked acting Labor Secretary Keith Sonderling to rescind the department’s proposal to allow private equity, digital assets, private credit, and other “alternative assets” to be included in 401(k) plans.
Source: Senate Banking Committee
They said the policy would “expose retirement accounts to exceptionally volatile assets, like digital currency,” citing a “lack of regulation and safeguards” putting many cryptocurrencies at risk of fraud.
Sanders, Warren and Scott — the ranking members of the Senate Committee on Health, Education, Labor and Pensions, the Senate Banking Committee and House Committee on Education and Workforce, respectively — said that the current administration had weakened enforcement of crypto fraud at financial agencies like the Securities and Exchange Commission (SEC).
“The application of securities laws to crypto assets is rapidly evolving, and many securities law protections that investors have for public securities may not be available for crypto,” said the letter. “This lack of sufficient guardrails is likely to harm investors.”
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The proposed policy, announced by the Labor Department in March, followed an August 2025 executive order from US President Donald Trump directing agencies to “democratize access to alternative assets,” including crypto. According to the Investment Company Institute, Americans held about $10.1 trillion in 401(k) plans as of Dec. 31.
Trump family conflicts of interest cloud 401(k) order and CLARITY Act
Sanders, Warren and Scott questioned whether the Labor Department policy would financially benefit anyone in the current administration, given Trump was “rife with conflicts of interest in this area,” including his family’s crypto venture, World Liberty Financial.
Lawmakers have made similar arguments in proposing amendments to a digital asset market structure bill, the CLARITY Act, expected to be addressed in the US Senate soon. Democrats in that chamber have said that they would not vote for any legislation that doesn’t contain provisions on ethics.
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