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Three years ago, the Department of Labor had “serious concerns,” effectively creating a ban on including crypto in 401(k) plans. But things are shifting in the opposite direction, as the Senate last month passed the first major cryptocurrency legislation, the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act to regulate stablecoins, and now the House passed the legislation on Thursday, now sending it to President Donald Trump, who is expected to sign it into law on Friday.
The GENIUS Act – the first major crypto legislation ever passed by Congress – establishes federal guardrails for dollar-denominated stablecoins. These digital assets, which are pegged to the U.S. dollar to maintain a stable value, would now be on a regulated pathway for private companies to issue digital dollars with the blessing of the federal government. Companies selling stablecoin assets to investors would be required to maintain robust reserves, adhere to rigorous transparency and anti-money laundering rules, and operate under enhanced regulatory supervision.essentially lessening restrictions on crypto in 401(k) plans.
Companies selling stablecoin assets to investors would be required to maintain robust reserves, adhere to rigorous transparency and anti-money laundering rules, and operate under enhanced regulatory supervision.
“For the first time in history, Congress has passed bipartisan digital assets legislation through both the Senate and the House,” said Senate Banking Committee Chairman Tim Scott (R-SC), after the House passed the GENIUS Act – legislation he co-sponsored and championed as it advanced through the Senate.
“The GENIUS Act marks a major milestone in securing America’s leadership in payments innovation while protecting consumers and strengthening our national security. This bill is critical to delivering on President Trump’s agenda to cement the United States as the crypto capital of the world, and I look forward to taking a similar approach to get digital asset market structure legislation signed into law. Digital assets and blockchain technology are here to stay, and it’s past time our regulatory framework acknowledges this reality,”
"Advancement of this bill to President Trump's desk marks a historic milestone for crypto entrepreneurs, financial market participants, and everyday Americans," said Securities and Exchange Commission Chairman Paul Atkins in a statement. Last month, the SEC announced that it is withdrawing proposals that would have applied to investment managers regarding crypto custody management.
In January, the SEC launched a crypto task force dedicated to developing a comprehensive and clear regulatory framework for crypto assets, naming “CryptoMom” Hester Peirce to lead the new task force. The task force was introduced amid expectations of a shift in the SEC’s approach to crypto under the crypto-friendly Trump administration.
Earlier this month, SEC’s Crypto Task Force announced new guidance on disclosure requirements for exchange-traded funds (ETFs) linked to cryptocurrencies, marking the first step toward approval of applications for ETFs. The crypto guidance will help speed up the approval process for these ETFs, “as part of an effort to provide greater clarity on the application of the federal securities laws to crypto assets,” according to the SEC.
Related: Senate passes landmark GENIUS stablecoin bill, lessening restrictions on crypto in 401(k)s
In May, the Department of Labor rolled back its Biden-era crypto warning, which effectively created a ban on including crypto in 401(k) plans. However, the DOL reaffirmed its neutral stance, neither endorsing, nor disapproving of, plan fiduciaries who conclude that the inclusion of cryptocurrency in a plan’s investment menu is appropriate, according to a statement.
“We’re rolling back this overreach and making it clear that investment decisions should be made by fiduciaries, not DC bureaucrats,” said Secretary of Labor Lori Chavez-DeRemer.
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