US Congressional Democrats oppose the Labor Department's relaxation of 401(k) investment restrictions to include crypto assets.

CoinFeed reported on June 2nd that, according to The Guardian, several Democratic members of Congress have written to oppose a Labor Department proposal to include high-risk assets such as cryptocurrencies, private lending, and private equity in the investment scope of 401(k) retirement plans. They argue that this move could expose approximately $14.2 trillion in retirement savings to highly volatile assets and would be difficult to justify in court. The letter cites data from Finra and the FBI, pointing out that crypto investments are highly volatile and that related fraud complaints are projected to result in losses exceeding $11 billion by 2025. Democrats also question the potential conflict of interest between the Trump administration and the crypto industry, pointing to the fact that Trump's family-issued memecoin once plummeted from approximately $75 to $2, and claiming that the proposal primarily benefits the crypto industry rather than retirees.