Labor Department officials believe Fidelity Investments’s plan to allow investors to put bitcoin in their 401(k) accounts risks the retirement security of Americans, a senior administrator said.
“We have grave concerns with what Fidelity has done,” Ali Khawar, acting assistant secretary of the Employee Benefits Security Administration, said in an interview with The Wall Street Journal.
Mr. Khawar’s group works inside the Labor Department to regulate company-sponsored retirement plans. In the interview, he said he views cryptocurrency as speculative. There is “a lot of hype around ‘You have to get in now because you will be left behind otherwise,’” he said.
Mr. Khawar said he received a heads up from Fidelity the day before the company disclosed its plan to give the 23,000 companies that use its 401(k) services the option to put bitcoin
on the menu. In the April 26 disclosure, Fidelity said that starting later this year, workers could allocate as much as 20% of their nest eggs to bitcoin. That threshold could be reduced by employers.