U.S. Treasury Secretary Janet Yellen warns that crypto is a “very risky investment,” adding that she would not recommend it to most people saving up for retirement. Yellen noted, however, that Congress could limit the type of investment allowed in retirement accounts, including 401 (k) plans.
Janet Yellen about investing in cryptocurrencies for retirement
Whether Americans should be able to put their retirement savings into cryptocurrencies is still hotly debated.
US Treasury Secretary Janet Yellen was asked at a New York Times event on Thursday about Fidelity’s announcement to allow bitcoin as an investment opportunity in 401 (k) plans.
It is not something I would recommend most people to save up for retirement … For me it is a very risky investment.
Fidelity’s announcement follows a directive issued by the Department of Labor (DOL) that warns administrators of 401 (k) plans to allow cryptocurrencies in pension plans. Fidelity is one of the largest administrators of 401 (k) plans.
Ali Khawar, acting deputy secretary of the DOL Benefits Security Administration, said the Labor ministry was “seriously concerned about what Fidelity has done.” He pointed out that “cryptocurrencies can pose serious risks to retirement savings.”
Finance Minister Yellen also noted on Thursday that Congress could regulate assets that can be included in pension plans such as 401 (k). Commenting on whether Congress should act, Yellen said:
I’m not saying I recommend it, but in my opinion it would be a fair thing.
The Department of Labor’s efforts to prevent Americans from putting crypto in retirement accounts have upset some lawmakers. In response, U.S. Senator Tommy Tuberville (R-AL) introduced the Financial Freedom Act to prohibit DOL “from issuing rules or guidelines that restrict the type of investment that autonomous investors in a 401 (k)) can choose through a broker window. . ” In addition, the Department of Labor has been sued for its crypto-consulting.
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