2 years ago
Two U.S. senators, including Elizabeth Warren, person sent a missive to Fidelity Investments demanding answers regarding the company’s determination to let bitcoin investments successful 401(k) status plans. “Investing successful cryptocurrencies is simply a risky and speculative gamble, and we are acrophobic that Fidelity would instrumentality these risks with millions of Americans’ status savings,” the lawmakers wrote.
US Lawmakers Concerned About Fidelity Allowing Bitcoin Investments successful 401(k) Plans
U.S. Senator Elizabeth Warren (D-MA) has sent a missive to Abigail Johnson, the CEO of Fidelity Investments, questioning the fiscal services giant’s program to allow bitcoin investments successful 401(k) accounts. The letter, dated May 4, is besides signed by U.S. Senator Tina Smith (D-MN).
The lawmakers wrote:
We constitute to inquire astir the appropriateness of your company’s determination to adhd bitcoin to its 401(k) concern program paper and the actions you volition instrumentality to code ‘the important risks of fraud, theft and loss’ posed by these assets.
The missive notes that Fidelity’s announcement followed the Department of Labor expressing “serious concerns” astir cryptocurrency concern options successful 401(k) plans, citing “significant risks of fraud, theft and loss” posed by crypto assets.
Senators Warren and Smith stressed:
In short, investing successful cryptocurrencies is simply a risky and speculative gamble, and we are acrophobic that Fidelity would instrumentality these risks with millions of Americans’ status savings.
The 2 senators proceeded to item the volatility of bitcoin compared to stocks successful the S&P 500. They besides noted that the terms of the cryptocurrency was influenced by Tesla CEO Elon Musk’s tweets and the “high attraction of bitcoin ownership and mining exacerbates these volatility risks.”
The lawmakers additionally warned:
We are besides acrophobic astir Fidelity’s imaginable conflicts of involvement and the grade to which they whitethorn person affected the determination to connection bitcoin.
The missive references Fidelity’s announcement successful 2017 that it had been mining cryptocurrency. Since then, the fiscal services steadfast has ramped up its crypto offerings, including offering its ain crypto money for affluent customers.
With the latest announcement, the senators said: “Fidelity has decided to determination afloat velocity up with supporting bitcoin investments,” claiming that the steadfast is doing truthful “Despite a deficiency of request for this enactment — lone 2% of employers expressed involvement successful adding cryptocurrency to their 401(k) menu.”
In conclusion, the 2 senators asked Fidelity 5 questions and requested answers by May 18. They privation to cognize wherefore Fidelity ignores the Labor Department’s crypto warning, the details of the company’s bitcoin hazard assessment, the fees customers volition incur, however Fidelity addresses its ain conflicts of interest, and however overmuch the institution has earned from crypto mining activities.
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What bash you deliberation astir Senator Elizabeth Warren questioning Fidelity connected its determination to let bitcoin investments successful status accounts? Let america cognize successful the comments conception below.
Kevin Helms
A pupil of Austrian Economics, Kevin recovered Bitcoin successful 2011 and has been an evangelist ever since. His interests prevarication successful Bitcoin security, open-source systems, web effects and the intersection betwixt economics and cryptography.
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