EBSA Revokes Biden-Era Guidance for Retirement Plan Crypto Investment Offerings

The Employee Benefits Security Administration (EBSA) has officially revoked Biden-era guidance cautioning against cryptocurrency investments in 401(k) accounts.  The prior guidance pointed to concerns about volatility in cryptocurrency investment returns and challenges in an evolving regulatory environment.  It specifically cautioned plan fiduciaries to use extreme care when considering even offering a cryptocurrency investment option within the 401(k) investment lineup, stating that it would expect plan fiduciaries to conduct investigative programs with respect to plans offering participants cryptocurrency investment options.  Further, the earlier EBSA guidance stated that plan fiduciaries should expect to be questioned about how the offerings impacted their duties of prudence and loyalty given the risks of cryptocurrency investments.  Understandably, this guidance caused many plan fiduciaries to shy away from even considering cryptocurrency investment options.  It remains to be seen how the revocation will impact the availability of cryptocurrency investments in 401(k)s.  For more information on considerations when investing in cryptocurrency, visit Tax Facts Online. Read More: Link to Q7726.