Tuberville, Donalds Renew Push for Crypto in 401(k) Plans
Sen. Tommy Tuberville (R-Ala.) and Rep. Byron Donalds (R-Fla.) reproposed the Financial Freedom Act on Tuesday. The legislation would prohibit the Secretary of Labor from restricting the investments available in self-directed 401(k) brokerage windows.
The legislation says that in the case of a “pension plan that provides for individual accounts and permits a participant or beneficiary to exercise control over the assets” in a brokerage account, the Department of Labor (DOL) cannot constrain “the range or type of investments that may be offered.”
The bill also prohibits the DOL from preventing “a fiduciary from selecting, any particular type of investment alternative, provided that a fiduciary provides the participant or beneficiary an opportunity to choose, from a broad range of investment alternatives,” nor can the DOL require that any “particular type of investment be either favored or disfavored, other than on the basis of the investment’s risk-return characteristics.”
The House version was referred to the House Committee on Education and Workforce, and the Senate version was referred to the Senate Committee on Health, Education, Labor and Pensions (HELP).
Donalds and Tuberville have introduced this same legislation before. The first time was in May 2022, and was a direct response to DOL guidance from March 2022 which discouraged the use of crypto in ERISA-governed plans.
This legislation is promoted as being pro-crypto. Tuberville explained in 2022 that “The Financial Freedom Act would preserve the ability of retirement savers to invest their 401(k) funds as they see fit — including investments in cryptocurrency.”
Tuberville also wrote an op-ed in 2022 in support of the Financial Freedom Act entitled “Cryptocurrency should be allowed in individual retirement plans. That’s why I’m introducing the Financial Freedom Act.”
The Blockchain Association and the Chamber of Digital Commerce endorsed the 2023 iteration of the bill, which is the same as the 2025 version.
Crypto, and other alternative investments, such as private equity, are not currently banned from ERISA-governed plans.
However, many fiduciaries are disinclined to include them in plan line-ups on the basis that some of them may have high volatility, risk profiles, and/or low liquidity; and these factors could be evidence of an imprudent process, exposing those fiduciaries to additional litigation risk.