Trump wants to "drain" American retirement funds to invest in Crypto Assets? Nine trillion in funds about to pump the market?

After the historic passage of three key Crypto Assets bills by the U.S. House of Representatives a few days ago, the Trump administration is preparing to drop a more powerful "depth charge." According to a major report from the Financial Times, President Trump is set to sign an executive order aimed at fundamentally reforming the way Americans save for retirement, allowing the inclusion of alternative assets such as Bitcoin, gold, and private sale equity into the $9 trillion 401(k) retirement plan.

As soon as this news broke, it immediately sparked heated discussions in the global financial market and the Crypto Assets community. This is not just a policy shift; it could potentially be a gateway for a massive influx of long-term funds into the Crypto Assets market. The market holds its breath, wondering if this tidal wave of retirement savings from millions of American households will become the "strongest driving force" to propel the next crypto bull market.

Nine trillion dollars of fresh capital

According to several informed sources, the core goal of this executive order is to break the long-standing situation where American 401(k) retirement plans can only invest in traditional assets such as stocks, bonds, and mutual funds. The order will clearly instruct major regulatory agencies in Washington, such as the Department of Labor, to re-examine and take steps to remove existing barriers that hinder alternative assets from being included in 401(k) professionally managed funds. The asset classes covered are extremely broad, including: digital assets such as Crypto Assets, precious metals like gold, private equity, private loans, corporate merger funds, and infrastructure-related assets.

Although the White House spokesman remains cautious about this news, stating that "unless the information comes from Trump himself, other sources should not be regarded as official decisions," the outside world generally interprets this as a signal before the formal policy announcement. The Trump administration's move aims to provide more diversified investment options for tens of millions of American wage earners' retirement savings to cope with the return challenges in a low-interest-rate environment.

To understand the potential impact of this policy, it is essential to grasp the enormous scale of the U.S. pension market. The 401(k) plan is one of the most important retirement savings tools in the United States, with total assets reaching an astonishing $8.9 trillion as of the first quarter of 2025, covering over 710,000 independent plans. This wealth, accumulated day by day by tens of millions of Americans, constitutes a massive amount of "long money" that drives stability in the U.S. financial markets.

Traditionally, these funds have almost all flowed into publicly traded stocks and bonds markets. The easing of this policy means that Crypto Assets are expected to become a potential allocation option in this $9 trillion large pool of funds.

In this regard, Omar, a partner at Dragonfly, analyzed that the total amount of retirement assets in the United States reaches 43 trillion dollars, with the 401(k) accounts accounting for nearly 9 trillion. Even if cryptocurrency can only capture a 1% allocation from this, it will bring about approximately 90 billion dollars in new capital inflow to the market. This is undoubtedly a powerful driving force for the current crypto market, which has a total market capitalization of about 4 trillion dollars, and will have a profound positive impact on its liquidity, market value, and institutional participation willingness.

Crypto Assets Grand Chessboard

The Trump administration's move is not without reason, but rather a continuation and climax of its series of pro-crypto policies. First, it is a direct counterattack against the policies of the previous Biden administration. In May of this year, the Trump administration's Department of Labor officially revoked the guidelines issued during the Biden era, which had strictly limited the inclusion of Crypto Assets in 401(k) plans on the grounds of excessive risk.

Secondly, this also echoes the long-standing efforts of the Republican Party in Congress. As early as 2022, Republican Congressman Peter Meijer proposed the Retirement Savings Modernization Act, attempting to incorporate digital assets into the framework of the Employee Retirement Income Security Act (ERISA) of 1974. Although it was unsuccessful, it laid the groundwork for today's policy shift.

More importantly, this move comes after the United States has just passed three landmark crypto asset bills, clearly indicating that the Trump administration is playing a big game aimed at providing comprehensive support for the development of crypto assets in the U.S., from legislation to funding access.

Before the policies at the federal level were officially implemented, the market giants with keen senses had already laid out their plans in advance: Asset Management Giants: Fidelity, the asset management giant with a scale of $5.9 trillion, took the lead by launching retirement accounts that allow holders to invest in crypto assets as early as April this year, seizing market opportunities. State Retirement Funds: Local retirement funds, including those in Arizona, Wisconsin, and Jersey City, New Jersey, have also taken the lead by investing hundreds of millions of dollars into Bitcoin spot ETFs and other crypto assets. International Trend: This trend is also global. The Japanese Government Pension Investment Fund (GPIF) has announced that it is studying the diversification benefits of Bitcoin, while an anonymous pension fund in the UK has allocated 3% of its assets to Bitcoin. Private Sale Giants' Feast: Besides crypto assets, this executive order is also a potential feast for private equity giants like Blackstone, Apollo, and BlackRock. These companies have pinned their hopes for future growth on managing funds from ordinary retirement savers and have actively established partnerships with major 401(k) plan sponsors such as Vanguard and Empower.

Feast of Wealth?

The proposed executive order by the Trump administration undoubtedly paints an extremely enticing prospect for the Crypto Assets market. Once the $9 trillion pension market is opened up, even a small trickle could have a huge impact on the prices and market structure of Crypto Assets.

However, under the expectation of euphoria, risks and challenges cannot be ignored. Critics warn that putting ordinary people's "retirement money" into highly volatile and less liquid alternative assets may expose them to greater financial risks. For regulators, finding a delicate balance between encouraging innovation, providing diverse options, and protecting investors will be a core challenge in future policy making.

It can be foreseen that once the executive order is officially signed, crypto assets will officially transition from a "high-risk speculative product" excluded by the mainstream financial system to a potential option in the retirement accounts of tens of millions of American households. This huge experiment led by the White House will not only redefine the meaning of "retirement savings," but will also profoundly shape the future landscape of global finance. As for whether it will trigger a "strong rally," the market is watching closely.