The U.S. Department of Labor proposed a rule to simplify adding alternative assets like private equity, private credit, and cryptocurrency to 401(k) plans.
The proposal establishes a legal safe harbor to protect plan fiduciaries from lawsuits regarding investment performance, provided they follow a rigorous evaluation process considering fees, liquidity, valuation, and complexity.
This initiative follows a prior executive order intended to grant millions of workers access to investment classes typically reserved for institutional and high-net-worth investors.
The rule could benefit major asset managers like Blackstone, KKR, and Apollo by tapping into the nearly $14 trillion defined contribution market.