However, the announcement that cryptocurrencies will be included in some retirement plans has not been received warmly by many, including David John, a senior policy advisor at AARP Policy Institute and the deputy director of the retirement security project at Brookings.
“Crypto itself is fascinating, and intriguing as it starts to develop, but it’s still in its early phases.
While alternative investments such as commodities are sometimes a part of target date funds, they are typically counter-cyclical, meaning that they go up when the market goes down and vice versa.
“Yes, we can point out that there are points in time, where it’s correlated with this, that and the other index or asset or something along that line,” says John.
Founded in 2012, San Francisco-based ForUsAll administers $1.7 billion in retirement fund assets for 70,000 employees — a tiny portion of the $21.8 trillion in defined contribution retirement assets in the U.S.
For example, Boston-based Fidelity investments, lets customers gain indirect exposure to cryptocurrencies through self-directed brokerage accounts that provide access to products offered by firms such as Grayscale and Osprey.
“Relatively small allocations to cryptocurrencies may add material expected return benefits without materially increasing risk,” Rameriz says.
While retirement expert John doesn’t think bitcoin is ready for 401s, ForUsAll argues that not offering crypto exposure exacerbates structural inequality by not providing everyday investors with access to a source of investment gains for the wealthy.