Senator Elizabeth Warren Takes Aim At Fidelity Investments Over Cryptocurrency Retirement Plans.

Senator Elizabeth Warren of Massachusetts addressed a joint letter to Fidelity Investments this week in response to the firm’s decision to accept Bitcoin on its platform.

Fidelity said in April that employees of the 23,000 organizations that use its 401(k) pension plan services could invest up to 20% in Bitcoin. For 20 million clients, the business manages $2.7 trillion in assets.

The decision, however, has aroused concerns among the US Labor Department and crypto’s most vocal critics. Warren asked Fidelity CEO Abigail Johnson what steps the firm will take to address “the significant risks of fraud, theft, and loss posed by these assets,” in a letter co-signed by Minnesota Senator Tina Smith.

Senator Warren used her customary rhetoric, alleging that “Bitcoin’s volatility is compounded by its susceptibility to the whims of a handful of influencers.”

The Democrats have given Fidelity until May 18 to respond to their inquiries concerning its Bitcoin investment strategy. They referenced a number of mainstream media FUD articles on large price changes, including the fact that Bitcoin is currently trading at a 47% markdown to its all-time high, which occurred six months ago. 

They also claimed that the mining process was highly centralized, claiming that “one study estimates that just 10% of Bitcoin miners are responsible for processing 90% of Bitcoin.”

A potential conflict of interest was also mentioned. Fidelity had announced in 2017 that it had set up a small Bitcoin and Ethereum mining operation, according to the letter.

“We are also concerned about Fidelity’s potential conflicts of interest and the extent to which they may have affected the decision to offer Bitcoin.”

Warren, who has dubbed cryptocurrency the “new shadow bank” run by “shadowy faceless groups of super-coders,” is doing everything she can to keep Americans out of this asset class.

However, not every American politician is as anti-crypto as the member of the banking, housing, and urban affairs committee. Senator Tommy Tuberville of Alabama has offered a glimpse of hope in the form of the Financial Freedom Act.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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