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Cryptocurrency, Featured, Press Release

The Argument for Cryptocurrency to be Included in 401(k) Plans

What started sometime in 2021 year and was inevitable – clients with 401(k) plans and a crypto-enthused population began querying if they could add cryptocurrency as a plan investment option. Given the prevalent conditions, it is advisable to exercise caution. 

The Greatly Volatile Asset

“In the 401(k) realm, even a self-directed brokerage window with built-in investment limitations is considered too risky. Hence the caution,” said Chowdhury, explaining the scenario. “ So much so that interested parties are practically on their own if they are at all permitted to add the alternative to their portfolio.”

What is an well-known fact is that cryptocurrency is a highly volatile asset. This gets confusing for even professional investors and expert traders. “This is the primary reason why it doesn’t sit well with 401(k) retirement planning, where plan fiduciaries are accountable for choosing investments that balance long-term growth maintaining a certain level of stability asking reasonable fees,” added Chowdhury.  

Also Read: Trading Crypto: The Top Cryptocurrency Exchanges in India

The Caution

Investment planners have, since long, shied away from crypto as an investment option for the common people. This is due to its links with several online illicit businesses and threat entities. However, cryptocurrency has since gained traction within the masses. “The idea of adding the alternative as a means of diversification of investment portfolio has occurred to many,” he continued pointing out that there doesn’t exist any clause under ERISA or Internal Revenue Code expressly barring the option. 

Department of Labor, in a press release “cautions plan fiduciaries to exercise extreme care before they consider adding cryptocurrency to a 401(k) plan’s investment menu for plan participants”. 

Irked by this statement, Chowdhury calls it a “starkly discouraging move” that is damaging to a myriad of businesses and also deprives individuals of a profitable investment instrument. The primary risk to investment in cryptocurrencies comes from it its volatility. The secondary risks associated with the digital assets are in the possibilities cyberattacks on exchanges, a crackdown on crypto mining, and other regulations including an outright ban.

It is common knowledge, though, that most of the secondary risks of cybercrime can be offset in retirement accounts by insuring plan custodians. Additionally, exchanges today have adequate safeguards and regulatory approvals implemented. More importantly, it must be borne in mind that diversification can be used to counter volatility.   

Also Read: Top Cryptocurrencies to Invest in 2022

Opinions and Developments

Chowdhury has previously spoken out against a major crypto-curbing law enacted by the EU. He has predicted the payment solutions to be the opportunity-in-making for investors. Despite levying heavy taxation on crypto profits Chowdhury sees light in the legislation by the Indian government.

Chowdhury-led HashCash is soon to start working on a Metaverse project. HashCash product HC remit is deployed in a Vietnamese payment service company to channel overseas payments and remittances. 


With a larger section of people are now ready to accept crypto as a potent investment instrument, it is only fair that they must not be deprived of the opportunity. This would be more appropriate in the case of millennials who wish to saving up in digital assets as a part of their retirement savings.


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