The legislation pretends that crypto assets are stable and mainstream, and they are not, the AFT wrote.
Crypto News
The American Federation of Teachers has sent a letter to the Senate Banking Committee opposing digital asset legislation that the union claims threatens retirement security for 1.8 million members.
The AFT told Republican and Democratic leaders Monday that it opposes passage of the Responsible Financial Innovation Act, the bill senators said built on the House's proposed CLARITY Act. According to the union, the legislation presents profound risks to economic stability and retirement plans. The letter, provided by CNBC, argues the bill fails to provide a regulatory structure for crypto assets and stablecoins equivalent to other pension holdings.
The union stated that most pensions do not carry crypto assets because of their risk. The legislation pretends that crypto assets are stable and mainstream, and they are not, the AFT wrote. The CLARITY Act drafts from July and November did not explicitly mention allowing digital assets in pensions or retirement funds, but the AFT claimed that if passed, pensions and 401(k) plans would end up having unsafe assets even if invested in traditional securities.
The American Federation of Labor and Congress of Industrial Organizations raised similar concerns in an October letter to the banking committee. That group claimed the legislation would increase workers' exposure by greenlighting retirement plans like 401(k)s and pensions to hold risky assets. Both labor organizations echo concerns about digital asset exposure in retirement accounts.
Aggregate public pension assets, including teachers, totaled more than $6.5 trillion as of the second quarter of 2025, according to the National Association of State Retirement Administrators. The Investment Company Institute reported in September that total retirement assets in the U.S. reached approximately $45.8 trillion. The AFT represents members working in education, healthcare, and public services across the country.
President Trump has moved separately to address crypto in retirement funds through executive orders. In August, Trump directed the Labor Department to reevaluate restrictions around alternative assets in defined-contribution plans, including digital assets. Asset management companies have signaled openness to adding digital assets to individual retirement arrangements and 401(k)s.
Morgan Stanley reportedly began allowing its advisers to suggest crypto funds as part of clients' retirement portfolios in October. State-managed retirement funds in Michigan and Wisconsin have exposure to crypto through digital asset-linked exchange-traded funds. The moves by asset managers stand in contrast to the labor unions' concerns about cryptocurrency in retirement accounts.
Wyoming Senator Cynthia Lummis, one of the bill's most outspoken proponents, said Tuesday she anticipated the banking committee releasing an updated draft this week. A possible markup hearing could occur before Congress breaks for the holidays, though the timing remains unclear. The Senate has not announced when it will vote on market structure legislation in the full chamber.
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