Congressman Richard Neal, who chairs the House of Representatives Ways and Means Committee, asked the Government Accountability Office (GAO) to provide information about the nexus between cryptocurrencies and American retirement accounts.
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This area has been the subject of some controversy, following financial services giant Fidelity’s move to allow clients to invest in bitcoin via their 401(k) accounts earlier this year. The US Labor Department, which warned about such options in a notice in March, later expressed concern about the Fidelity offering.
Neal’s letter to GAO Comptroller General Gene Dodaro didn’t cite Fidelity by name but honed in on defined contribution (DC) retirement plans, of which a 4o1(k) is one type.
“Recent announcements from major DC plan providers indicate that many employers who sponsor DC plans will have the option to allow their employees to invest in cryptocurrencies,” the letter states. “However, concerns have arisen about the risks to older Americans’ retirement security of using retirement accounts to invest in cryptocurrencies due to their volatility and limited oversight.”
Per the letter, Neal is seeking information on which firms are offering crypto-related retirement services and how those plans are administered. Neal also wants the GAO to “[a]ssess the oversight of cryptocurrency investment options in 401(k) plans by the relevant agencies, and guidance federal agencies provide to plan sponsors, participants, and beneficiaries about investing in cryptocurrency and examine the current restrictions, if any, on investments in cryptocurrency in 401(k) plans.”
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