Senator Elizabeth Warren aims for fidelity over cryptocurrency retirement plan

Massachusetts Senator Elizabeth Warren wrote a joint letter to Fidelity Investments this week regarding the decision to allow Bitcoin to the platform.

In April, Fidelity announced that employees of 23,000 companies using 401(k) annuity planning services could allocate up to 20% in Bitcoin. The company manages $2.7 trillion in assets for 20 million customers.

However, the move raised red flags with the US Department of Labor and some of the cryptocurrency’s biggest detractors. at letterCo-signed by Minnesota Senator Tina Smith, Warren asked Fidelity CEO Abigail Johnson what actions the company will take to address “the significant risk of fraud, theft and loss of these assets.”

Warren asks about conflicts of interest.

Senator Warren relied on her usual rhetoric to argue that “Bitcoin volatility is more complex because it is sensitive to the whims of a small number of influential people.”

Democrats offered Fidelity through May 18 to answer questions about their approach to investing in Bitcoin. They cited a number of mainstream media FUD articles about the key price movement, including the fact that BTC is now down 47% from its six-month high. They also said that there was a lot of centralization in the mining process. “One study estimates that only 10% of Bitcoin miners handle 90% of Bitcoin.”

There was also mention of a potential conflict of interest. The letter referred to the 2017 announcement that Fidelity had begun small-scale Bitcoin and Ethereum mining operations.

“We are also concerned about Fidelity’s potential conflict of interest and the extent to which it may influence its decision to offer Bitcoin.”

Having classified crypto as a “new shadow bank” controlled by a “faceless group of supercoders”, Warren is doing everything it can to prevent Americans from accessing this asset class.

Financial Freedom Act

Fortunately, not all US politicians are as anti-crypto as members of the Banking, Housing and Urban Affairs Committee. Alabama State Senator Tommy Tuberville has shone a ray of light in the form of the Financial Freedom Act.

Policy makers believe that governments should not interfere with the tangible assets that individuals want to invest in. In an article for CNBC on May 5, Tuberville said:

“Whether you believe in the long-term economic prospects of cryptocurrencies or not, the choices you make about your retirement savings are yours, not the government.”

His proposed legislation aims to prevent the Department of Labor from limiting the types of assets that can be used in a 401(k) retirement plan.


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