DOL withdraws crypto letter

On May 28, 2025, the Trump DOL issued guidance rescinding a prior (Biden) DOL release targeting sponsors who offer crypto investments in 401(k) plans.

2022 Biden DOL Compliance Assistance Release

In 2022, the Department of Labor issued a “Compliance Assistance Release” that generally cautioned against 401(k) plans including “cryptocurrencies” (and other “digital assets” including “tokens,” “coins,” “crypto assets,” and “derivatives thereof”) in a 401(k) plan fund menu or brokerage window, claiming crypto investments: are speculative and volatile; are difficult for participants to evaluate; generally are not custodied in the same way that, e.g., stocks or bonds are; do not have a “sound or academically defensible” valuation model; include “some market participants [that] may be operating outside of existing regulatory frameworks or not complying with them.”

Most problematically, the 2022 Compliance Assistance Release raised the possibility that fiduciaries might be required to monitor specific crypto investments offered through a brokerage window, stating:

The plan fiduciaries responsible for overseeing such [crypto] investment options or allowing such investments through brokerage windows should expect to be questioned about how they can square their actions with their duties of prudence and loyalty in light of the risks described [in the 2022 Compliance Assistance Release]. (Emphasis added.)

2025 Trump DOL Compliance Assistance Release

The Trump DOL’s Compliance Assistance Release rescinded the 2022 Compliance Assistance Release “in full.” In the key passage, the 2025 Compliance Assistance Release states:

Prior to the 2022 release, the Department had usually articulated a neutral approach to particular investment types and strategies. Today’s release restores the Department’s historical approach by neither endorsing, nor disapproving of, plan fiduciaries who conclude that the inclusion of cryptocurrency in a plan’s investment menu is appropriate. When evaluating any particular investment type, a plan fiduciary’s decision should consider all relevant facts and circumstances and will “necessarily be context specific.” [Citing the Supreme Court’s decision in Fifth Third Bancorp v. Dudenhoeffer (2014).]

Most would agree that that paragraph is (more or less) a simple statement of ERISA black-letter law.

* * *

After considerable push-back, DOL did little with respect to retirement plan crypto investments after issuing the original release, and seemed to downplay the release’s significance in subsequent litigation challenging it.

We will continue to follow this issue.