Bitwise pushes back on Bitcoin 401(k) limits as Warren seeks U.S. SEC answers

Hougan made the case in a live interview, contending that volatility alone is not a coherent basis for exclusion. He noted that over the past year, Bitcoin’s trading range was narrower than Nvidia’s and said banning a single asset class on volatility grounds “doesn’t make sense” when similarly volatile stocks remain available in 401(k) menus. In 2025, Nvidia’s shares swung roughly 120% from trough to peak, compared with about 65% for Bitcoin, according to the comparison cited in the interview.

The remarks came the same day Warren released an open letter demanding the SEC explain how it will mitigate risks if plan sponsors allow “alternative investments” such as crypto in 401(k)s. Warren warned that higher fees and price volatility could harm savers, calling the typical workplace plan a “lifeline to retirement security rather than a playground for financial risk,” and set a Jan. 27 response deadline for the Commission.

Policy context has shifted over the past year. In August 2025, the White House directed the Labor Department to revisit restrictions on alternative assets in defined-contribution plans, opening the door to potential crypto access. In May, the Employee Benefits Security Administration rescinded a 2022 compliance release that discouraged the practice and said it would take a neutral stance – neither endorsing nor disapproving – on crypto in 401(k)s.

Hougan said adoption timing remains uncertain but predicted eventual normalization as recordkeepers and fiduciaries move deliberately. “These are very slow-moving institutions,” he said, adding that offering Bitcoin alongside other options should, in time, be treated like any other menu decision under plan governance standards.

The debate now centers on fiduciary process rather than a categorical ban. Warren’s queries ask whether the SEC is accounting for crypto volatility in corporate disclosures, assessing the prevalence of manipulation in crypto markets, and planning investor-education materials specific to retirement savers. Industry advocates counter that broader rulemaking – and recent executive-branch and Labor Department signals – support a case-by-case approach where plan sponsors weigh costs, liquidity, and risk, rather than excluding an entire asset class.

For retirement plans weighing next steps, the practical decisions sit with providers and investment committees: whether a Bitcoin option fits their lineup construction; how to benchmark performance and fees; what safeguards and education to require; and whether to use spot-price exposure via regulated products. As those fiduciary mechanics play out, the policy split – Hougan’s push for parity versus Warren’s call for tighter guardrails – frames a 2026 test over how, and if, crypto belongs inside mainstream U.S. 401(k)s.