Trump To Reportedly Open The Floodgates Of 401K Money To Cryptos; Bitcoin Could Reach $250K

To gain an edge, this is what you need to know today.

Trump Gambit

Please click here for an enlarged chart of Bitcoin (CRYPTO: BTC).

Note the following:

• The chart shows that after the breakout above zone 1 (support), bitcoin has been consolidating in a narrow range.
• Typically, the bitcoin pattern shown on the chart leads to a pullback before a move higher.  However, a new executive order that President Trump is about to sign has the potential to not only stop the pullback but push bitcoin higher.  The first magnet for traders is $140K.
• President Trump’s executive order has the potential to push bitcoin to $250K and then potentially to $1M in the long term.  By now, you may be asking what is President Trump about to do that is going to light a fire under bitcoin — President Trump appears to be ready to sign an executive order to open the floodgates of retirement money, including 401K money, to cryptos.
• To understand what President Trump is about to do, investors need to understand the history of retirement plans in the United States.
  • Before 1963, retirement fund scandals were common, as there were not stringent federal requirements to protect workers’ retirement money.  Many employers raided their pension funds for ulterior purposes and often mismanaged retirement funds that cost workers their retirement.  
  • The key catalyst came in 1963, when the Studebaker Auto Company collapsed, causing thousands of workers to lose their pensions.  The Studebaker collapse and other scandals lead to Congress passing the Employee Retirement Income Security Act (ERISA).
  • ERISA established three standards:
    • Retirement plan sponsors have a fiduciary duty to act prudently in the best interest of participants.
    • Investment decisions must be made in a way that a prudent man would make to protect retirement funds.
    • Retirement plans must avoid concentration of assets in risky assets.
• As crypto gained popularity, in 2022 the Department of Labor cautioned plan sponsors against including cryptos in 401K’s due to the high risk.
• President Trump is now set to issue an executive order directing regulators to remove barriers to retirement plan money, especially 401K money, to flow into cryptos.
• Prudent investors need to get ahead of the curve and understand that President Trump’s action will open the floodgates of 401K money to cryptos.  
• Prudent investors also need to look ahead to midterm elections.  In a midterm election, historically, the President’s party loses an average of 3.6 Senate seats and 28 House seats.
• Opening …

Full story available on Benzinga.com