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Why Fidelity’s Bitcoin 401(k) Option Faces Fresh Scrutiny

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Before you go betting your retirement on Bitcoin, the U.S. Labor Department would like to say its piece.

Ali Khawar, the acting assistant secretary of the Employee Benefits Security Administration, told the Wall Street Journal the department has “grave concerns” about Fidelity’s move to include the option of investing in bitcoin within its 401(k) savings program.

Fidelity recently made history by being the first retirement account to allow investors to put Bitcoin in their 401Ks. The crypto offering is planned to be available for 23,000 employers that use Fidelity to administer their retirement accounts by the middle of 2022.

FULL VIDEO TRANSCRIPT BELOW:

We have the U.S. Labor Department not being so keen on Fidelity allowing investors to diversify their 401(k)s with Bitcoin.

It’s your boy Ross Mac and this is what cryptocurrency investors are watching on Friday, April 29.

The acting assistant secretary of the Employee Benefits Security Administration told the Wall Street Journal that they have--and I quote--grave concerns about Fidelity's move.

He highlighted the speculative nature of cryptocurrency and the hype around the fear of missing out as reasons his department is concerned about the move.

The product, which is expected to launch this summer, will let investors invest up to 20% in bitcoin within the 401(k) savings program.

In response to their comments, Fidelity said its bitcoin offering “represents the firm’s continued commitment to evolving and broadening its digital assets offerings amidst its steadily growing demand, and we believe that this technology and digital assets will represent a large part of the financial industry’s future.” After all, a poll from NBC news in March found that one in five Americans have used cryptocurrencies.

It’s your boy Ross Mac and that was the Crypto Minute on TheStreet.

TheStreet's Crypto Minute is brought to you by Blockchain.com.

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