(Kitco News) - A new $9 trillion investment channel could soon open up for assets like Bitcoin, gold, silver, and private equity.
According to a Financial Times article citing three sources, President Donald Trump is preparing to sign an executive order that would allow 401(k) funds to invest in alternative assets such as cryptocurrencies and precious metals.
The article reports that the executive order would instruct government regulatory agencies to review and address remaining hurdles to allow such alternative investments in professionally managed 401(k) plans.
“President Trump is committed to restoring prosperity for everyday Americans and safeguarding their economic future,” the White House said in a statement to the Financial Times. “No decisions should be deemed official, however, unless they come from President Trump himself.”
A 401(k) plan is a company-sponsored retirement account where employees can contribute a portion of their income. Employers often match at least part of these contributions. According to the Investment Company Institute (ICI), Americans held $8.7 trillion in 401(k) plans as of the first quarter of this year.
In an interview with Kitco News, Axel Merk, President and Chief Investment Officer at Merk Investments, said the proposed executive order would help clarify the complex tax code regarding what types of investments can be included in retirement plans.
Merk added that the move aligns with the government’s broader goal of cutting red tape to spur innovation in financial markets and strengthen the economy.
While some analysts warn that introducing volatile assets like cryptocurrencies or illiquid ones like private equity into retirement accounts could increase risk, Merk believes that education and transparency would help mitigate these concerns.
“Should only millionaires be allowed to invest in private equities, or should it be open to mom and pop?” he asked. “There is no easy answer to that because, obviously, there's a risk that investors will put money into things they don’t understand. Philosophically, however, it is the right thing to do to provide access.”
Although Trump has focused on establishing U.S. leadership in global cryptocurrency markets, some analysts argue that the executive order could have a major impact on gold and silver as well, sparking renewed interest among retail investors.
Phillip Streible, Chief Market Strategist at Blue Line Futures, described the initiative as a bullish catalyst for gold and silver as more investors seek to protect their wealth.
“There’s strong recognition that since COVID, the traditional 60/40 portfolio has failed to keep up with inflation,” he said. “Studies have shown that even a small allocation to alternative assets like gold can significantly improve portfolio performance.”
In a May report, analysts at FTSE Russell highlighted gold's role as a neutral asset in times of geopolitical uncertainty and rising government debt levels.
Their research found that from 2010 to the present, a 60/20/20 portfolio (stocks/bonds/gold) delivered an annualized return of 7.5% with volatility of 8.55%, resulting in a Sharpe ratio of 0.38. By comparison, a traditional 60/40 portfolio returned 6.3% annually with volatility of 8.01%, yielding a Sharpe ratio of 0.28.
“Exposure to gold in a multi-asset portfolio can enhance risk-adjusted returns, particularly in macro environments where the classic bond-equity hedge is less reliable,” the analysts noted. “In the multi-asset space—where macroeconomic uncertainty, deglobalization, and liquidity shifts increasingly challenge asset allocators—gold offers an alternative hedge, making it a proactive tool for navigating risk and capturing value across diverse regimes.”
