Bitcoin prices surged to $116,850 on Thursday, showing an increase of more than 2% after reports revealed that President Donald Trump plans to sign an executive order allowing crypto and other alternative assets in 401(k) retirement accounts, potentially unlocking a large pool of Bitcoin facility capital.
The executive order, scheduled to be signed Thursday, directs the Labor Bureau to reevaluate existing guidance on alternative investments controlled by the Employee Retirement Income Security Act of 1974 (ERISA). The move will allow Americans to gain greater access to Bitcoin and crypto through retirement savings accounts, which currently hold about $12.5 trillion in assets.
This executive order represents a fork moment for Bitcoin adoption. Opening a 401(k) for Bitcoin investment could fundamentally reconstruct the institutional landscape of Bitcoin and drive critical new capital into space.
The development continues to accelerate as companies adoption of Bitcoin continues to accelerate, and we see notable moves from companies like Metaplanet, which purchased 463 BTC worth $53.7 million in recent weeks, as well as smart web companies that have launched a remanted convertible bond with $21 million in Bitcoin. The number of public companies holding Bitcoin has skyrocketed to over 200 in the past few months, highlighting the growing institutional trust in asset classes.
The Labor Bureau is tasked with clarifying the fiduciary responsibility of retirement plan providers that provide funding, including alternative assets, and may remove important barriers that historically limit the exposure of Bitcoin and crypto in retirement accounts. Industry experts suggest that this can pave the way for a more refined Bitcoin investment product tailored to retirement savings.
Clarifying fiduciary duties could be a game-changer for retirement planning providers. It could remove one of the main regulatory uncertainties that keeps many institutional players on the bystanders.
Market observers note that the timing of the executive order coincides with the increasing institutional interest in Bitcoin as an asset and investment vehicle of the Treasury. Recent launches of innovative financial products such as Bitcoin denominated bonds and specialized preferred stocks suggest that the market is already evolving and is responding to increased institutional participation.
The executive order is expected to benefit not only Bitcoin and crypto, but also other alternative assets, including private equity and real estate. However, Bitcoin’s position as a major crypto has become a major focus for institutional investors looking to gain exposure to the crypto market.
The volume of trading across major cryptocurrency exchanges has skyrocketed following the news, with over $30 billion of Bitcoin changing hands in the last 24 hours. Market responses suggest pricing of the potential long-term impact of investor accessing retirement accounts to Bitcoin.
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