House bill

House Bill Aims to Protect Bitcoin Retirement Accounts From Federal Ban

Following last week’s crypto crash, which caught the attention of regulators and government officials, a group of Republicans in Congress today introduced a bill that would “protect” investors’ ability to add Bitcoin 401(k) retirement plans.

The bill, the House companion to the Financial Freedom Act of 2022, was introduced by Rep. Byron Donalds (R-FL) with support from fellow Rep. Warren Davidson (R-OH), Young Kim (R-CA), David Schweikert (R-AZ) and Tom Emmer (R-MN).

If passed, the bill would prevent the US Department of Labor from restricting the type of investments 401(k) account holders can select, including Bitcoin, which Fidelity plans to make available later this year. .

According to a Press release, the bill was drafted in response to regulatory guidance issued by the Benefits Security Administration on May 10, which suggests that investors should be restricted from adding crypto to 401(k) plans. Donalds’ bill seeks to “protect American investors” from what he and his co-sponsors consider a “flagrant example of government abuse,” the congressman said in a statement.

Last month, Fidelity became the first brokerage to announce plans to begin offering Bitcoin as an investment option in 401(k) accounts. The move was met with skepticism and concern by Democratic Senators Elizabeth Warren and Tina Smith. Warren has long been critical of cryptocurrencies and has previously called digital assets “a risk to our financial stability and our economy.”

The Department of Labor has expressed its own concerns about Fidelity opening its Bitcoin retirement accounts. Citing Bitcoin’s volatility, Ali Khawar, Acting Assistant Secretary of the Employee Benefits Security Administration (EBSA), told the the wall street journal“We are very concerned about what Fidelity has done.”

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