Judge validates Labor Department’s caution on crypto in retirement plans

The agency would still maintain its focus on regulatory scrutiny of crypto-related activities, regardless of guidelines, a judge said

article-image

GoodIdeas/Shutterstock, modified by Blockworks

share

A US federal judge rejected ForUSAll’s lawsuit against the Department of Labor (DOL).

The move upholds the agency’s cautionary stance that cryptocurrencies may not be suitable for retirement savings.

ForUSAll sued the DOL in June last year, arguing that its efforts to limit cryptocurrency in retirement accounts were “arbitrary and capricious.”

In March, the Department of Labor released guidelines for 401(k) plans contemplating crypto investments and warned of potential investigations for those offering such options. 

After that announcement, ForUSAll claimed that about one-third of its plan participants decided not to move forward due to concerns about enforcement actions.

ForUsAll requested the court to rule that the department’s statement is illegal and to nullify and overturn it.

But US Judge Christopher Cooper said in a memorandum on Tuesday that even if the guidance were to be revoked, it wouldn’t alter the DOL’s perspective on the risks associated with cryptocurrency or its intention to scrutinize such offerings.

ForUsAll lacks the legal standing to proceed due to unproven redressability, according to the judge.

“Without clear evidence to the contrary, it is hard to fathom how this relief would restore ForUsAll’s lost business opportunities because it is doubtful that plan fiduciaries would disregard these lingering risks and partner with ForUsAll if the Release itself were no longer effective,” Cooper said.

He added that it’s improbable that retirement plans will readily re-engage with ForUsAll because it is still governed by fiduciary responsibilities, which are likely to be stringently enforced by a department that remains skeptical about cryptocurrency.

ForUsAll started offering alternative investment choices in 401(k) plans in 2021, using Coinbase Institutional for digital asset custody and trading.

The company manages $1.5 billion in assets and serves more than 80,000 retirement savers across over 500 plans, with clients including Solana, TaxBit and Uniswap.


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the Forward Guidance newsletter.

Get alpha directly in your inbox with the 0xResearch newsletter — market highlights, charts, degen trade ideas, governance updates, and more.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Javits Center North | 445 11th Ave

Tues - Thurs, March 18 - 20, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

kamino cover.jpg

Research

Kamino has solidified its position as the leading money market on Solana and is emerging as a DeFi bluechip. Although DeFi competition is fierce, Kamino has kept iterating on its product to provide the best-in-class UX, paired with a robust risk management framework and battle-tested infrastructure. Given the rollout of Kamino Lend V2, the protocol may scale aggressively over the coming months, penetrating previously untapped markets in Solana DeFi.

article-image

OpenSea co-founder Devin Finzer claims the new OpenSea is being rebuilt “from the ground up”

article-image

A pilot project from Swift, UBS and Chainlink demonstrates how tokenized funds can bridge traditional and crypto rails

article-image

Predictions that the US election will fuel bitcoin’s price are set to be tested

article-image

A tumultuous presidential campaign comes to an end

article-image

Republican challenger Bernie Moreno captured the industry’s attention when he went up against a key member of the so-called “anti-crypto army”

article-image

Swan Bitcoin managing director John Haar is among those expecting that the election may only have a short-term impact on crypto markets