U.S. House introduces Financial Freedom Act companion bill to allow Bitcoin in 401(k)s
On Friday, Florida Republican Rep. Byron Donalds filed the Financial Freedom Act in the United States House of Representatives to restrict the United States Department of Labor from limiting the types of investments that can be included in Americans’ self-directed 401(k) retirement plans. The legislation is a companion piece to Alabama Senator Tommy Tuberville’s May 5 Senate bill.
The Financial Freedom Act was launched in response to a March 10 U.S. Department of Labor (DOL) compliance report that raised concerns about the inclusion of cryptocurrencies in 401(k) retirement plans.
The Employee Benefits Security Administration, according to the report, “expects to conduct an investigative program aimed at plans that offer participant investments in cryptocurrencies and related products, and to take appropriate action to protect the interests of plan participants and beneficiaries with respect to these investments.”
Donalds said in a statement that the Department of Labor’s comments were a “far-reaching and comprehensive endeavor to centralize power in Washington” and that the guideline “infringes on the foundational principles of economic liberty and free markets.”
The Republican congressman claims that his bill has the support of numerous House members, including Reps. Warren Davidson (R-OH), Young Kim (R-CA), David Schweikert (R-AZ), and Tom Emmer (R-MN).
The cryptocurrency industry has also endorsed the Financial Freedom Act. Donald’s release includes quotes from the Blockchain Association and the Chamber of Digital Commerce.
The success or failure of the Financial Freedom Act has implications for Fidelity Investments, a firm that announced plans to offer Bitcoin (BTC) in its 401(k) retirement plans earlier this year despite challenges.
The DOL report elicited a response from the financial services giant objecting to what it saw as unclear language and positions that strayed from the intent of the law that created the 401(k) program. It requested the DOL clarify the report or withdraw it.
It’s unknown how many other major investing organizations are actively working to offer Bitcoin retirement choices. The proposals presented this month, on the other hand, aim to prevent the Department of Labor from generally mandating assets allowed in 401(k) plans, implying that they will be relevant beyond crypto.
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