The aftershocks of the FTX disaster continue to roll on. The latest tremor for the industry came on November 22, as New York Attorney General (NYAG) Letitia James urged lawmakers to prohibit employer retirement plans and IRAs from investing in digital assets.
In a letter to Congress, James proposes legislation that would ban digital asset investment by retirement plans and, adding a cherry on top, also requests the scrapping of two Acts currently on the table, namely the Retirement Savings Modernization Act and the Financial Freedom Act of 2022. The former would allow 401(k) plan fiduciaries to make digital assets an investment option, while the latter would constrain the Secretary of Labor from prohibiting investments in digital assets.
This is not the first time James has attempted to curtail the ‘crypto Wild West,’ being the same NYAG who, back in 2019, went after Bitfiniex and Tether—calling the companies ‘perverse’ in their attempt to avoid the investigation of a reported $850 million loss suffered by Bitfinex, that Tether alleged to have helped cover-up. This case was eventually settled in February of last year in a deal that involved the payment of an $18.5 million penalty and no admission of wrongdoing.
This latest move by the NYAG against the asset class she describes as having “no intrinsic value on which their prices are based” comes uncoincidentally in the wake of the FTX collapse.
In the letter, James states that with the recent…
