In yet another executive order, President Trump is giving an even bigger nod of approval to his cryptocurrency buddies.
An executive order directs the U.S. Department of Labor, or DOL, to reexamine its guidance on fiduciary decisions, ensuring asset funds that include alternative investments are available to retirement plan participants.
It also directs the secretary of DOL to clarify the department’s position on alternative assets, including the appropriate fiduciary process associated with offering asset funds containing alternative asset investments under the Employee Retirement Income Security Act, or ERISA.
In the order, the DOL secretary is also directed to “prioritize actions that curb frivolous ERISA litigation, which can constrain fiduciaries from applying their best judgment when selecting investments and investment options.”
It also instructs DOL to work with other federal agencies, such as the Treasury Department and Securities and Exchange Commission, to determine if the regulators should carry out changes to their policies.
Private equity, real estate, and other digital and alternative assets are also among the alternative investments covered by the executive order.
Trump’s DOL has already taken action to rescind Biden Administration’s guidance that had warned of the many risks of buying cryptocurrency, including extremely volatile valuations, exposure to fraud, and difficulties with record keeping. It advised fiduciaries to think twice before including any crypto options in retirement plans offered to employees.
Keith Sonderling, deputy secretary of DOL, said Trump’s executive order directs the DOL to “level the playing field for all Americans saving for retirement by breaking down barriers to investment opportunities previously accessible only to certain pension plans and the very wealthy.”
Don’t be fooled by Trump’s love of cryptocurrency and the changes his administration is making to regulations on it. Cryptocurrency it too volatile and unsafe to be in your retirement accounts.
Trump has made hundreds of millions of dollars in the White House from his recent activities on cryptocurrency, according to an article in USA Today. Trump has made $620 million that includes about $460 million from World Liberty Financial, a decentralized financial company and platform that sells its own branded tokens. The Trump family has stake in the venture. Trump’s meme coin, called $TRUMP, has also earned an estimated $320 million in fees, but it’s unclear how much has gone toward a Trump-controlled entity and its partners.
The Trump administration has also eliminated the Department of Justice’s crypto enforcement, which is worrisome since Trump’s pro-cryptocurrency moves are expected to make sales surge.
The executive order would encourage retirement funds to invest in private equity and it comes as that sector is hungry for capital after shrinking last year for the first time in decades, according to The Hill, a digital news organization. Through the order, Trump would be opening up retirement plans to riskier investments while giving private equity a much-needed capital infusion.
Trump’s never been a great businessman. He’s wrong on crypto and other alternative investments, too.
