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U.S. Senators Condemn Fidelity Investments Bitcoin 401(k) In Open Letter

  • U.S. Senators wrote an open letter to the CEO of Fidelity regarding its bitcoin 401(k) plan.
  • Senators condemned the lending company for offering bitcoin being an optional retirement investment strategy.
  • The senators also recognize the struggles of Americans attempting to save for retirement but cant appear to understand traditional finance may be the problem.

An open letter from three U.S. Senators was delivered to the CEO of Fidelity Investments to condemn the companys recent launch of a bitcoin 401(k) retirement plan.

Senators Elizabeth Warren, Richard Durbin and Tina Smith called Fidelitys decision to provide contact with bitcoin through retirement accounts immensely troubling.

The senators argue that bitcoin is really a volatile, illiquid, and speculative asset unfit for the retirement accounts of U.S. citizens. The legislators continued to describe some statistics in detailing the tiny amount of cash that’s, on the median, held on these retirement accounts $33,472.

Warren and her colleagues then check out paint an image of Americans looking for their retirement because they are living longer than previously and are more likely to outlast their retirement savings.

This begs the question: when saving for retirement has already been challenging for so many Americans, why would Fidelity allow those that can save to come in contact with an untested, highly volatile asset like Bitcoin?, reads the letter.

It appears that as the senators can handle understanding there exists a distinct insufficient savings open to a generation of workers which will progressively reach an increased age than their predecessors, they lack the opportunity to spot its true cause. As is frequently the case in politics, although it is easy to indicate an issue, the move from the backboning cause which traditional finance infrastructures are arguably a component is frequently looked down upon to keep the status quo.

Fidelity offers the optionality of escape from the doomed system because of its customers. Additionally, because the senators described within their letter, Fidelity also caps retirement investment allocations to bitcoin. Using this method, Fidelity is effectively providing the optionality of bitcoin while preventing investors from placing all their funds for the reason that basket.

Fidelity researched Bitcoin, understood its value and began supplying a product with capped contact with make certain any volatility felt by the marketplace in the short-term had not been detrimental to anyones livelihood. The investment manager also clearly outlines that bitcoin isn’t a short-term bet and that investors should develop long-term investment strategies.

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