The Department of Labor's Employee Benefits Security Administration is facing a tight deadline to issue guidance on alternative assets in 401(k) plans following the recent government shutdown. The guidance, prompted by a White House executive order, could include a fiduciary safe harbor for plan sponsors, says J. Mark Iwry, a former Treasury official. EBSA is also preparing to release a new fiduciary rule in 2026 that is expected to be less restrictive than the Biden-era version, aligning with the current administration's deregulatory goals.

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Both active and passive strategies have important roles to play for investors and the markets, but the current narrative on active and passive is overly negative on active management. The Active Managers Council's latest whitepaper, Balancing the Narrative on Active and Passive, explains why -- and how -- the narrative has become lopsided and why the outlook for active management is bright.

The IAA joined a broad coalition of associations urging swift passage of the bipartisan Financial Exploitation Prevention Act (S. 2840/H.R. 2478). The bill would give firms clear authority to pause suspicious redemption requests when senior or vulnerable investors may be at risk of exploitation. This safeguard is critical, protecting assets before they're lost and strengthening industry efforts to combat elder financial abuse.

The Securities and Exchange Commission has sent warning letters to Direxion, ProShares and Tidal, effectively halting the launch of exchange-traded funds that aim to deliver three to five times the daily returns of underlying assets. The SEC cites concerns that the ETFs' risk exposures could exceed regulatory limits.

At a meeting of the Securities and Exchange Commission's Investor Advisory Committee, finance and crypto leaders outlined differing views on how tokenization and decentralized finance should be regulated as adoption accelerates. Panelist Samara Cohen of BlackRock noted the value of the discussion in surfacing "distinct paths and perspectives," underscoring that multiple regulatory approaches may be needed. The session took place in light of a Citadel Securities letter urging stronger oversight of DeFi for tokenized securities, which drew criticism from some crypto advocates. Executives from firms including Citadel Securities, Coinbase and Galaxy emphasized the importance of regulatory clarity but differed on how decentralized systems should fit within existing frameworks.

The Commodity Futures Trading Commission has launched a pilot program allowing bitcoin, ether and USDC to serve as collateral in derivatives markets, part of acting Chair Caroline Pham's broader push to modernize digital asset oversight. The initiative, which includes new reporting requirements for futures commission merchants, rolls back older restrictions and could accelerate institutional use of tokenized collateral.

The House Financial Services Committee has advanced the Incentivizing New Ventures and Economic Strength Through Capital Formation Act, which packages more than 20 bipartisan measures to strengthen capital markets. The bill includes provisions to expand the definition of "accredited investor," allow 403(b) plans to invest in the same products as 401(k) plans, and reduce disclosure requirements for emerging growth companies.

The Treasury Department and IRS have issued initial guidance on Invest America accounts, commonly known as Trump accounts. The guidance covers account creation, contributions, eligible investments and distributions, and notes that Roth conversions will be allowed once beneficiaries turn 18. Public comments are being solicited until Feb. 20 for additional regulations to be released in early 2026.

Sen. Kirsten Gillibrand, D-N.Y., has introduced a bill to increase Social Security benefits for widows and divorced individuals entitled to benefits from deceased ex-spouses. The Surviving Widow(er) Income Fair Treatment Act aims to address inequities that reduce survivor benefits, allowing widowed and surviving divorced spouses with disabilities to receive 100% of their entitled benefits at any age.