Author: FinTax Owen
On August 7th Eastern Time, U.S. President Trump signed an executive order "Democratizing Access to Alternative Assets for 401(k) Investors" at the White House, requiring the Treasury Department, Department of Labor, and Securities and Exchange Commission (SEC) to initiate rule revisions that would include cryptocurrencies, real estate, private equity, and other "Alternative Assets" within the 401(k) retirement investment scope. This news was like a thunderbolt, quickly shocking global financial markets - it could potentially leverage up to $8.7 trillion in retirement pools and is seen as a key step for crypto assets moving from the margins to the mainstream financial system.
Although the White House claims this move aims to "expand ordinary investors' accessibility to diversified assets", a core question emerges: Is this truly opening a new chapter of wealth appreciation for Americans' retirement future, or a nationwide gamble without considering consequences?
1. 401(k) Plan: The Cornerstone of the U.S. Retirement System
To understand the significance of this move, one must first clarify the weight of 401(k) in the U.S. retirement security system. The U.S. pension system consists of three pillars: The first pillar is the government-operated mandatory Social Security, which pays basic pensions to retirees monthly; the second pillar is employer-provided retirement savings plans, with 401(k) being the most prevalent, accumulated through pre-tax employee contributions and employer-matched contributions, with limited investment options provided by employers; the third pillar is Individual Retirement Accounts (IRA), voluntarily opened by individuals with a broader investment range, with some IRA types already allowing cryptocurrency investments.
[Rest of the translation continues in the same manner, maintaining the original structure and translating all text while preserving any HTML tags and specific terms like TRON, HT, OP, AR, RON, ONG]4. Another Perspective: Tax Deferral and Fiscal Bargaining
For a long time, the US 401(k) plan has had two tax models: the traditional model with "pre-tax contributions, taxed as ordinary income upon retirement withdrawal," and the Roth model with "after-tax contributions, tax-free withdrawal when meeting conditions" — regardless of the model, both have the effect of delaying tax on investment returns, which is their long-term appeal. Therefore, incorporating crypto assets into 401(k) investment scope will not change these basic tax rules, but means that this highly volatile asset is first entering a compliant "shell" of tax deferral or tax exemption, allowing investors to enjoy account tax advantages while betting on long-term growth in the crypto market.
In this framework, the fiscal impact is more like a time-based tax game. For investors choosing a "traditional account," current taxable income decreases, resulting in short-term tax reduction, but future withdrawals will be calculated as taxable income in one lump sum — a typical "nurturing fish" strategy of using today's concessions to gain a larger tax base decades later. If crypto assets succeed long-term, the returns cashed out at retirement could far exceed current levels, thus bringing higher taxes for the government; conversely, if the market is sluggish or the policy environment shifts, short-term tax sacrifices might result in long-term fiscal emptiness. This is the greatest risk and uncertainty in fiscal and tax terms.
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