Trump's Executive Order Invests Retirement Funds in Cryptocurrencies; Lee Jae-myung Regime Issues Stablecoins
The Trump administration has institutionalized a hard-line conservative system that mobilizes capital markets through "investment loss forgiveness" by employers and trustees, requiring the investment of $12.2 trillion in retirement funds in cryptocurrencies and unlisted private equity funds.
The Lee Jae-myung administration is spearheading the issuance of stablecoins in the cryptocurrency sector.
President Trump's Executive Order, "Democratizing Access to Alternative Assets for 401(k) Investors," signed on the 7th, directs the Department of Labor, which oversees retirement plans, to reevaluate its fiduciary guidelines regarding retirement fund management and investment and clarify its position on appropriate processes for offering funds that include alternative assets. However, the executive order actually aims to make it easier to incorporate alternative assets such as private equity, cryptocurrencies, and real estate into 401(k)s and related employee retirement plans.
American media outlets estimate that these accounts represent a combined $12.2 trillion in retirement savings, calling the Trump administration a significant shift from the previous Biden administration's previous warnings about the risks of cryptocurrency investment, which blocked access to retirement funds.
The executive order, which establishes a U.S. policy requiring retirees to have access to funds that include investments in alternative assets, defines alternative assets as <(i) private market investments, including direct or indirect interests in stocks, debt, or other financial instruments not traded on a public exchange; <(ii) direct or indirect interests in real estate, including debt instruments secured by direct or indirect interests in real estate; and <(iii) holdings in actively managed investment vehicles that invest in digital assets>. The primary targets include unlisted stocks, derivatives, cryptocurrencies, and real estate investments.
The executive order further stated, "In carrying out the guidance in this section to advance the policies set forth in the order, the Secretary of Labor shall prioritize measures to deter ERISA litigation that restricts the ability of fiduciaries to exercise their best judgment when providing investment opportunities to plan participants." The order stated its purpose was to "deter retiree lawsuits against employers."
Arthur Laby, a professor and vice provost at Rutgers Law School, told the New York Times that the executive order is significant because it "adds a critical element to the complex recipe" for determining when a fiduciary, such as an employer, has failed to meet its obligations. He called it a labor law lawsuit control order against employers.
The New York Times reported, "The Employee Retirement Income Security Act (ERISA), the fundamental law governing retirement accounts, requires fiduciaries (the employer or plan administrator entrusted with the plan) to act solely in the best interests of employees, including prudent investment selection."
The Times added, "Private equity funds that include unlisted investments are currently not widely accessible to retirees, but some large financial services firms, including BlackRock, the largest private equity firm, are developing products that include them, including one expected to launch in the first half of next year."
The New York Times reported that a fund that invests Trump administration retirement funds in cryptocurrencies and unlisted stocks is expected to launch "early next year."
BlackRock, the largest private equity firm in the United States, has long been an advisor to the South Korean Ministry of Strategy and Finance. Under the Moon Jae-in administration, Kim Yong-beom, then Vice Minister of Strategy and Finance, held regular meetings with Kim before submitting his fund management plan to the IMF in New York.
He later became the policy chief under the Lee Jae-myung administration, advocating for the introduction of stablecoins into South Korea.
In financial investment products, derivatives incur fees several times higher than those for regular time deposits and savings funds, and fees are customarily paid upfront. Furthermore, with the Korean financial authorities guaranteeing mandatory deductions of contracted fees from losses, a system has become established where major Korean banks sell derivatives as their flagship products to their customers.
If derivatives investment is permitted for retirement benefits, fees would be imposed on investment losses, potentially resulting in a total loss in the worst-case scenario.
In the United States, severance-related lawsuits are prevalent, primarily involving workers challenging the excessive fees charged by employer-designated trust managers in trust management, and law firms suing employers.
The New York Times stated, "Employers have long feared being sued for investment options that may be perceived as frivolous or simply overpriced. This is why these changes are unlikely to spark a major overhaul of 401(k) plan menus or prompt a rapid increase in demand for digital assets like cryptocurrencies." The Trump Executive Order targets this by stating, "It will democratize access to alternative assets." It also states, "The Secretary should aim to identify criteria that fiduciaries should use to carefully balance potentially higher costs with the goals of pursuing greater long-term net returns and broader investment diversification." It also states, "The Secretary should prioritize measures to discourage ERISA litigation that restricts fiduciaries' ability to exercise their best judgment when providing investment opportunities to plan participants." The order also directs the Secretary to "discourage employee lawsuits against employers."
U.S. Secretary of Labor Lori Chavez-DeRemer applauded the order in a statement, stating, "The Department of Labor wants to make alternative asset investments more accessible to plan participants. This Executive Order further supports our efforts to improve flexibility and eliminate unfair, one-size-fits-all approaches."
The executive order specifically directs Labor Secretary Chavez-DeRemer to consult with Treasury Secretary Scott Bessent, the Securities and Exchange Commission, and other federal regulators to determine whether regulatory changes should be made at other agencies to facilitate implementation of the order, which appears to be a key driver of the overall financial governance overhaul.
Edward Gottfried, vice president of Betterment, which manages $19 billion in retirement assets, told the New York Times that the executive order's "401(k) plan management and investment selection" section is "subject to fiduciary rules that require employers and any advisors they may work with to review investments and maintain fair fees and performance consistent with general market returns."
"The whole nature of private equity is private, not public," Jerome Schlichter, managing partner at Schlichter Bogard, a St. Louis-based retirement law firm, told the New York Times. "If trustees were considering these types of funds for their plans, they would have to do a lot more work, a lot more research, a lot more scrutiny of what the underlying private equity investments are and what the fees are."
The firm gained notoriety in the United States for successfully suing employers over retirement plans they deemed mismanaged and overly expensive.
Kim Yong-beom, head of policy at the stablecoin initiative and a longtime collaborator with the US private equity firm BlackRock, is a derivatives expert who ruled out the potential side effects of a Ponzi scheme during Shinhan Financial Group's Lime Fund in 2020. He also prioritized the exclusion of potential side effects during the current stablecoin issuance drive, demonstrating a mutually beneficial connection.
On May 21, the Hong Kong Legislature passed the Stablecoin Bill, which establishes a licensing regime for issuers of fiat-backed stablecoins. Anyone issuing stablecoins in Hong Kong or those backed by the Hong Kong dollar must obtain a license from the Hong Kong Monetary Authority (HKMA).
Bloomberg and Reuters reported that China's financial regulators have canceled and issued guidelines for stablecoin seminars in China to curb brokerage transactions through Hong Kong, as cryptocurrency trading is prohibited on the mainland.
Blackrock is the second-largest shareholder of Shinhan Financial Group, the controlling shareholder of Shinhan Bank, while the National Pension Service is the largest shareholder. The National Pension Service is also the largest shareholder of KB Kookmin Bank, part of KB Financial Group.
See <Lee Jae-myung Regime's Stablecoin Shakes the Korean Won, Linked to Trump's Genius Act, June 9, 2025>
<BlackRock Policy Director Kim Yong-beom's Close Encounter with Lime Fund's Ponzi Stablecoin, June 9, 2025>
<Trump's Simultaneous Holding of Cryptocurrency and Real Estate: 'Double the Rise, Double the Loss' Lee Jae-myung's 'Economic Stimulus,' June 29, 2025>