DOL urges caution in offering cryptocurrencies in 401(k) plan options

The U.S. Department of Labor recently cautioned plan fiduciaries to exercise extreme care before considering adding a cryptocurrency option to a 401(k) plan’s investment menu for plan participants.

The DOL says cryptocurrency investments present significant risks and challenges to participants’ retirement accounts for a variety of reasons, including that cryptocurrencies are volatile and speculative investments that present challenges for plan participants to make informed decisions.

The DOL is advising plan fiduciaries that oversee or allow such investments to expect to be questioned about how they can justify their actions in light of these risks.