The cryptocurrency market experienced a surge on Thursday, fuelled by anticipation that Bitcoin and other digital assets may soon be integrated into 401(k) retirement plans. This positive sentiment pushed the price of Bitcoin to reclaim the $116,000 level for the first time since July 31. Widespread inclusion of Bitcoin in American retirement accounts has long been considered a crucial step for broader crypto adoption.
President Donald Trump is expected to sign an executive order that would allow 401(k) accounts to invest in alternative assets, encompassing private equity, real estate, and digital assets. This potential move has sparked excitement within the crypto community, with the expectation that it could significantly broaden access to digital assets and encourage longer-term investment.
Crypto-linked stocks showed gains, although they traded off their session highs as the broader stock market rally lost momentum in afternoon trading. Companies like Coinbase and Galaxy Digital, a diversified financial services firm dedicated to the digital asset and blockchain technology industry, both saw increases of 1.5%. Bitmine Immersion experienced a gain of almost 4%.
Galaxy CEO Michael Novogratz highlighted the potential impact of this development, stating that it could significantly widen the aperture for crypto investment and bring more people into the ecosystem. He noted that making crypto investments commonplace through established financial institutions like Fidelity or T. Rowe Price could further encourage participation. The retirement market currently holds $43 trillion, with nearly $9 trillion in 401(k) plans, presenting a substantial pool of capital for potential crypto investment.
