Bitcoin Expected to Reach $90K Following House Letter – SEC Faces Urgent Deadline on 401(k) Crypto Inclusion

The House Financial Services Committee has issued a letter to the SEC, urging changes to allow Bitcoin and other cryptocurrencies in 401(k) retirement plans. This shift could provide new opportunities for investors in the crypto space, though it faces criticism over potential risks.

Key Takeaways

The House Financial Services Committee has requested the SEC to revise rules to enable Bitcoin in 401(k) retirement accounts.
This move accompanies President Trump's executive order aimed at easing alternative investments in retirement plans.
Supporters argue current regulations are outdated and limit investment choices for American savers.
Critics highlight the volatility of cryptocurrencies and potential fiduciary risks, with significant opposition from groups like the American Federation of Teachers.
The change could lead to a reclassification of digital assets, benefiting both institutional investors and plan administrators.

Introduction to Cryptocurrency in Retirement Plans

On December 12, 2025, the House Financial Services Committee sent a letter to the Securities and Exchange Commission (SEC) advocating for amendments to existing regulations that would allow Bitcoin and other digital currencies to be included in 401(k) retirement plans. This initiative aims to officially incorporate cryptocurrency into the U.S. retirement system, paving the way for new capital influx into this asset class.

Urgent Legislative Action for Crypto in Retirement Funds

The letter references President Trump’s executive order from August 7, 2025, titled “Democratizing Access to Alternative Assets for 401(k) Investors.” This directive calls on the SEC and the Department of Labor to evaluate and eliminate barriers that prevent alternative investments from being part of retirement plans. Following the announcement, Bitcoin (BTC) was seen trading at $90,304, reflecting a slight increase of 0.08%.

This legislative effort is further supported by the “Retirement Investment Choice Act” (H.R. 5748), a bill aimed at cementing the executive order's guidelines into law. Politicians backing this move argue that outdated regulations hinder millions of American savers from accessing modern investment opportunities.

Addressing Concerns: Fiduciary Risks and Market Volatility

Despite the support, there has been immediate pushback from critics who cite the substantial volatility and fiduciary risks associated with cryptocurrencies. Notably, the American Federation of Teachers has publicly opposed similar initiatives, warning against the potential for fraud and arguing that speculative assets like Bitcoin may jeopardize retirement security for investors.

Financial experts have echoed these apprehensions, highlighting a lack of long-term stability data and regulatory clarity surrounding cryptocurrencies. Warren Buffett has previously commented that Bitcoin generates no cash flow, likening it more to gambling than a reliable investment option.

The Broader Institutional Perspective

While the focus is on individual access to cryptocurrencies, the implications for institutional investors are even more significant. This push from Congress is not just about adding a Bitcoin exchange-traded fund (ETF) to the 401(k) investment menu; it seeks to redefine how digital assets are viewed legally and financially.

If the SEC responds positively, it could provide necessary legal protection to plan administrators and asset managers who have previously avoided cryptocurrency investments due to concerns over litigation risks related to the Employee Retirement Income Security Act (ERISA).

This development would change the dialogue from “Is this allowed?” to “What constitutes a prudent investment allocation?” Consequently, asset managers are likely to speed up the creation of institutional-grade crypto products tailored for the defined-contribution market, regardless of the SEC's immediate action.