- Watcher Guru tweets big news about the US Labor Department.
- The US Labor Department suggests risks and challenges to the crypto business.
- People replied to this news with such an interesting point of view.
Watcher Guru, the web3 news channel on Twitter, announced in a tweet that the US Labor Department shares concerns about crypto as it has “significant risks and challenges to participants retirement accounts, including significant risks of fraud, theft, and loss.”
JUST IN: The US Labor Department says #Bitcoin& crypto poses “significant risks and challenges to participants retirement accounts, including significant risks of fraud, theft and loss.”
— Watcher.Guru (@WatcherGuru) March 11, 2022
The labor agency issued a warning stating that employers that add crypto investments to their company 401(k) plans can easily run afoul of their legal obligations to workers who are plan participants.
In this matter, acting assistant secretary at the Employee Benefits Security Administration Ali Khawwar wrote:
At this early stage in the history of cryptocurrencies the U.S. Department of Labor has serious concerns about plans’ decisions to expose participants to direct investments in cryptocurrencies or related products, such as NFTs, coins and crypto assets.
As the officials implied, employers who offer a 401(k) plan have a fiduciary duty relative to the investments they make available. In other words, these employers will be held responsible for their plan as they will be acting on behalf of the investments they allowed.
As the Labor Department explained, they outlined some of the potential risks of crypto, mentioning that “crypto is speculative, volatile and hard to value, and it may be challenging for investors to make an informed investment decision.”
People commented on this notice in a really interesting way, as a lot of the comments were criticizing the government announcement. Some other comments suggested that it is a signal to buy crypto as they speculate that the market will go down after this announcement.
Disclaimer: The views and opinions expressed in this article are solely the author’s and do not necessarily reflect the views of CoinQuora. No information in this article should be interpreted as investment advice. CoinQuora encourages all users to do their own research before investing in cryptocurrencies.