#BitcoinSPACDeal Opportunity of $13 trillion: Why Bitcoin in 401(k)s Could Redefine Retirement Investment

The incorporation of Bitcoin (BTC) into U.S. 401(k) retirement plans could create a $13 trillion investment fund, a significant shift in popular usage. Even a small investment in Bitcoin can provide a consistent long-term capital flow, significantly greater than spot ETFs, as millions of Americans contribute to this plan every two weeks.

Bitcoin could enter the $12 trillion investment alternatives in U.S. 401(k)s, which could be its largest structural influx. On August 7, Varys Capital's head of venture capital and former senior analyst at Messari, Tom Dunleavy, wrote on X that cryptocurrencies in the 401(k) retirement plan are larger and more optimistic than ETFs.

Dunleavy estimated that 100 million Americans participate in the 401(k) plan, which automatically invests a portion of each paycheck into pre-selected stock and bond portfolios. These allocations are reviewed annually at most, ensuring a steady cash flow into financial markets. This 401(k) plan has also helped U.S. stocks survive and grow over the last two decades.

Dunleavy estimates that 401(k) assets amount to $12 trillion, with $50 billion in new contributions every two weeks. The expert said that even a small Bitcoin portfolio would generate considerable and recurring inflows. He predicted that a 1% allocation would buy $120 billion, 3% $360 billion, and 5% $600 billion.

The debut of spot Bitcoin ETFs may not have the same long-term effect as cryptocurrencies in the 401(k) plan

Regulatory Background on the Path to BTC Adoption

Dunleavy said that the Employee Retirement Income Security Act of 1974 is strongly related to the likely inclusion of Bitcoin in 401(k) investment options.