Proposed Legislation Bars Crypto From Social Security Trust Funds
As the Department of Labor (DOL) releases its proposal opening alternative investments in 401(k) plans, a new bill would ensure that Social Security trust funds never invest in cryptocurrencies.
U.S. Senate Democratic Whip Dick Durbin (D-IL) this month introduced the No Crypto in Social Security Act, which would safeguard Social Security trust funds from alternative investments.
In a statement announcing the bill, Durbin warned against the negative financial impacts in allowing Social Security funds to invest in cryptocurrencies and called crypto a “volatile asset.”
“Social Security is a bedrock promise that hardworking Americans who pay into the program will earn their retirement,” said Durbin. “If the Social Security Trust Funds were allowed to invest in crypto, any downturn in the crypto market could create huge losses for seniors and people with disabilities and their families, disrupting Social Security’s promise. My bill will ensure the Social Security Trust Funds are never gambled away on cryptocurrencies, preventing this risky asset from backing Americans’ retirement funds and blocking the President from further lining his own pockets.”
The bill comes months after President Donald Trump signed an executive order that would open alternative investing in 401(k) plans. The DOL has since released its proposed rule allowing retirement plan fiduciaries to consider private market assets in retirement accounts, if fiduciaries abide by the Employee Retirement Income Security Act of 1974 (ERISA).
Skeptics have voiced concern over the investment’s potential impacts to long-term savings and have touched on its history of unpredictability. Further, some have noted potential conflicts of interest between Trump and his own ventures with cryptocurrency. Trump in 2025 launched his own meme coin, “$Trump,” on the Solana blockchain, which has since netted billions through the sale of tokens.
“If the Social Security Trust Funds ever invested in crypto—especially the President’s crypto ventures—the benefits of tens of millions of Americans would be put at risk, while taxpayer dollars could further enrich President Trump and his family,” Durbin’s statement reads.
Durbin’s bill is endorsed by Social Security Works, Alliance for Retired Americans, Americans for Financial Reform, Consumer Federation of America, Public Citizen, American Federation of Labor and Congress of Industrial Organizations (AFL-CIO), American Federation of Teachers (AFT), National Committee to Preserve Social Security and Medicare, and Strengthen Social Security Coalition.
Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with nearly a decade of experience and a passion for telling stories and reporting news. She is originally from Queens, New York, but now resides in Denver, Colorado.