President Donald Trump Just Brought Great News for Bitcoin Investors

The victory in the election of President Donald Trump in November has become a sweet dream for cryptocurrency investors, nothing is more amazing for those investing in the world's most valuable cryptocurrency, Bitcoin (CRYPTO: BTC). Since Trump's victory last November, Bitcoin has increased by nearly 60% (as of May 29, 5) and has surpassed the $111,000 mark multiple times. Trump has surrounded himself with cryptocurrency-supporting advisors and appointed the former director of a financial and cryptocurrency consulting firm to run the Securities and Exchange Commission. He has also announced the establishment of the U.S. Strategic Bitcoin Reserve to hold Bitcoin currently in the hands of the government and may even purchase more. And Trump has just brought even more amazing news for Bitcoin investors. Will Bitcoin soon be in your retirement account? During former President Joe Biden's tenure, the Department of Labor issued guidance for U.S. companies, warning them to be "extremely cautious" before allowing employees to invest in cryptocurrencies through their 401(k) savings accounts: At this stage of development, cryptocurrencies have had to endure extreme price volatility, possibly due to many uncertain factors related to the valuation of these assets, speculative behavior, reported instances of fraudulent transactions, widely publicized thefts and frauds, and other factors. The extreme volatility can have devastating effects on participants, especially those nearing retirement and those with significant allocations to cryptocurrencies. Guidance from federal agencies is not the law of the land, but it often has a chilling effect, as companies are typically concerned that if they act contrary to official guidance, they may find themselves under scrutiny. The Trump administration has now revoked this guidance, which is somewhat a green light for employers to consider offering cryptocurrency or cryptocurrency-related investments to their employees, if they wish. However, the current Department of Labor adds that it "neither endorses nor opposes" cryptocurrency investments in 401(k) accounts. Another potential headwind In 2024, the Government Accountability Office of the United States found that while some 401(k) programs allow employees to invest in cryptocurrency, the actual level of investment remains low. However, the new guidelines and the Trump administration's friendly approach to cryptocurrencies may change this and create another momentum for Bitcoin and the sector. Most cryptocurrency experts believe that wider adoption by more traditional financial institutions will help push cryptocurrency prices higher. Retirement savings in 401(k) plans have reached over $8.9 trillion by the end of 2024, so even this group gradually increasing their cryptocurrency purchases could make a significant difference. Now, whether investors should consider adding cryptocurrency to their 401(k) accounts is another question. Last year, BlackRock, the world's largest asset management company, released a report on whether Bitcoin should be included in a multi-asset investment portfolio. Ultimately, the report concluded that Bitcoin could consume a similar allocation to the "Magnificent Seven" stocks that are soaring. According to the report: Those stocks [Seven amazing stocks] represent single investment portfolios that account for a relatively large share of the portfolio risk like bitcoin. In a traditional portfolio with a mix of 60% stocks and 40% bonds, those seven stocks, on average, each account for a share equivalent to the overall portfolio risk like allocating 1-2% to bitcoin. We believe that is a reasonable range for a bitcoin investment. Bitcoin is currently considered by many to be equivalent to digital gold and therefore a hedge against inflation and a safe haven as concerns about the financial situation in the United States increase. For this reason, I believe that having a small amount of Bitcoin in your investment portfolio makes sense as it provides a form of diversification beyond stocks and bonds. Bitcoin has shown resilience and some similar properties to gold, such as the limited supply of 21 million tokens. In my opinion, Bitcoin is the only cryptocurrency today that deserves a small allocation in account 401(k). All other cryptocurrencies appear to be unstable and do not show any real attributes that would help make a diversified asset portfolio safer.