If you’ve lucky enough to have a 401k retirement plan offered by your employer, beware. Private equity and cryptocurrency interests want a big piece of it.

SUMMARY

What are we talking about?

Private equity (PE) refers to firms that make monetary investments from wealthy individuals, pension funds and university endowments in companies that are not publicly traded.

Cryptocurrencies are a form of digital currency (also called “digital assets”) that allows people to make payments directly to each other through an online system that is not controlled by any one person, organization or nation state.

What happened? 

Donald Trump signed an Executive Order on August 7 that would allow 401k workplace retirement funds totalling $12 trillion to invest in private equity firms and cryptos.

How did this happen?

Private equity corporations and cryptocurrency exchanges and their respective billionaire owners and investors donated massive sums in the 2024 political election - targeting Trump and pro-crypto Congressional candidates.

Why did this happen?

Private equity and cryptocurrencies pushed hard for these changes, to be sure, to increase their profits, but in the case of cryptos, to gain credibility. 

What can we do about it?.

If you have a 401k, communicate to your employer that you don’t want a nickel of your hard earned retirement fund invested in risky, opaque and expensive ventures.

Support enacting  HJR54, the We the People Amendment.

DETAILS

What are we talking about?

Private equity (PE) refers to firms that make monetary investments from wealthy individuals, pension funds and university endowments in companies that are not publicly traded (i.e. companies not listed on the stock market). These funds are used as leverage to borrow the bulk of the funds needed for purchases. Once PE firms purchase companies, they make various changes in their operations with a goal of selling the companies in a few years at a profit. Changes can be positive to enhance future growth or negative by “stripping” companies involved in almost all facts of our lives of all their profitable assets and/or shift the remaining debt to these companies.. Blackstone Group with assets of $881 billion is the largest PE firm in the world. 

Cryptocurrencies are a form of digital currency (also called “digital assets”) that allows people to make payments directly to each other through an online system that is not controlled by any one person, organization or nation state. “Cryptos” have no legislated or intrinsic value, not backed by anything. Their worth is simply determined by what people are willing to pay for them at any one time. Bitcoin is the oldest and largest crypto.

What happened? 

Donald Trump signed an Executive Order on August 7 that would allow 401k workplace retirement funds totalling $12 trillion to invest in private equity firms and cryptos. Stocks and bonds currently make up  the vast majority of 401k retirement investments. A few heavily traded commodities, such as gold, are also included. It will be at least 6 months before employers can explore investing 401k funds in PE firms and cryptos. The Executive Order follows Trump’s announcement of the creation earlier this year of a Strategic Bitcoin Reserve.

How did this happen?

Private equity corporations and cryptocurrency exchanges (i.e. companies where to buy and sell cryptos) and their respective billionaire owners and investors donated massive sums in the 2024 political election - targeting Trump and pro-crypto Congressional candidates. 

• Private equity firms and individuals associated with them invested more than $231 million in the 2024 election. Republicans and conservative groups were the preferred recipients. 
• Trump was the recipient of $5,671,784 from the Securities and Investment industry, according to Open Secrets.
• The crypto to industry raised more than $245 million in the 2024 election cycle from corporate contributions, super PACs and individual billionaire industry leaders to political candidates. It  accounted for nearly 50% of all corporate money invested in the election, surpassing the fossil fuel industry in political campaign financing. 
• More than 50% of crypto political investments were directed  to Trump and Harris. Trump received over $22 million from at least 17 big donors, including Bitcoin investor and now Secretary of Commerce Howard Lutnick who invested $6.4 million.
• Additionally, crypto corporations and investors gave $18 million to Trump’s inauguration.

Why did this happen?

Private equity and cryptocurrencies pushed hard for these changes, to be sure, to increase their profits, but in the case of cryptos, to gain credibility. 

Returns on private equity investments have done poorly compared to the S&P 500 (i.e. the largest 500 publicly traded companies in the U.S.). Much of this has been due to the growing aversion to the high risks of these investments. Another reason is that private equity firms don’t have to publicly provide the same information about company performance as publicly-held companies. This lack of transparency reduces the protection of investors. Lastly, "private equity executives have enriched themselves by the billions, taking high fees and other charges from working people's hard-earned retirement savings in pension funds,” according to Lisa Donner of the  Americans for Financial Reform Education Fund. Private equity is salivating at getting their corporate hands (note: we know, corporations don’t have hands) on $12 trillion in retirement accounts. 

When it comes to the cryptocurrencies, there is not only enormous profit to be made for investors (i.e. bitcoin is up 36% since the November election), but the need for credibility. Only 1 in 4 individuals owns any cryptocurrencies. This is due to the lack of awareness, unease that there’s no physical representation (i.e. a piece of metal or paper), and the fact that they aren't backed  by anything – with some comparing it to a modern day 17th century Tulip mania. There’s the issue of volatility – with sometimes huge daily swings in gains and losses – as well as its enormous energy consumption, contributing to climate collapse. Finally, there's security issues. The amount stolen by hackers from digital “wallets” in crypto accounts is already at $2.17 billion in 2025, which is more than all of 2024). The industry is looking for credibility wherever it can find it. More investors increases the profit of current investors. Being “acceptable” for 401k retirement investments is a hook to draw in more investors. Beware.

What can we do about it?

It’s the same old, same old story. Legalized bribery. Pay-to-play. The interests of money and power served at the expense of the interests of the majority of people. Private equity and crypto corporations receiving a massive return on their political investments to Trump.

If you have a 401k, communicate to your employer that you don’t want a nickel of your hard earned retirement fund invested in risky, opaque and expensive ventures.

Whether you have a 401k or not, we all need to beware that big money in elections from billionaires and corporate entities – including now the biggest corporate industry of them all – cryptos – is not simply risking what little amount of democracy we have, which was never much to begin with. It’s stripping it bare, similar to what many private equity firms are doing to the companies they take over and plunder. 

Abolishing political money in elections and corporate constitutional rights – are the twin goals of HJR54, the We the People Amendment  is the solution to affirming human rights, community rights, and the right of people to decide their own present and future. 

It’s the currency of democracy, which to be enacted must be backed up by all of us.

In solidarity,

Katie, Alfonso, Jessica, Jason, Tara, Cole, Shelly, George, Daniel, Kelsey, Jennie, Keyan, Michael, Margaret & Greg

-- Move to Amend National Team