Department of Labor Issues Guidance on Cryptocurrency and ERISA retirement plans


All ERISA retirement plans


March 10, 2022


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The Department of Labor recently released long awaited guidance on the use of cryptocurrency in retirement plans governed by ERISA. The guidance used an expansive definition of cryptocurrency, including crypto-tokens, coins, and assets, along with any derivatives.


The guidance spelled out the concerns the DOL has about a plan fiduciary’s allowance of cryptocurrency in a retirement plan. Specifically, the DOL is worried about the high risk of fraud, theft, and loss that currently accompanies cryptocurrency. Additional concerns from the guidance include:


  • The SEC’s determination that cryptocurrency investments are highly speculative and volatile.
  • That cryptocurrency is not held in a trust or custodial account like most plan assets.
  • The difficulty in accurately accessing cryptocurrency value.
  • The lack of rules and regulations surrounding cryptocurrency markets.
  • The hurdles plan participants must overcome to make informed decisions.


Fiduciaries have the responsibility to evaluate the investments offered to participants and that duty extends to evaluation of cryptocurrency as an investment option in the plan. According to the DOL, including cryptocurrency in the plan could be considered a signal to plan participants that investment experts consider cryptocurrency a prudent investment option. A plan sponsor’s failure to remove irresponsible investments is considered a breach of fiduciary duty.


The DOL essentially ended the guidance with a warning to plan sponsors that they plan to “conduct an investigative program aimed at plans that offer participant investments in cryptocurrencies.” Plan sponsors are now on notice that including cryptocurrency in their retirement plans could increase the chances of being audited.


Action Items

  1. If considering including cryptocurrency options in retirement benefits, review fiduciary obligations with legal counsel.
  2. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.


Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser.

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