Why more retirees may be warming up to crypto
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Coinbase's chief security officer breaks down the key things to consider, including risks, allocation strategies, and more.
Thu, December 4, 2025 at 12:00 PM EST 6 min read
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Many retirees and near-retirees might be curious about investing in crypto but unsure whether to take the plunge.
Philip Martin, chief security officer for Coinbase Global, believes that individuals nearing or in retirement should consider investing in digital assets.
"Just like any diversified portfolio, crypto can be a component of a retiree's or near-retiree's assets," Martin said in a recent Decoding Retirement podcast. "But also, I think they should think about it as something that's really important to learn about."
For one, he noted that major household-name financial firms, such as BlackRock (BLK), are now launching crypto ETFs after doing a significant amount of due diligence. Other wealth managers, such as Bank of America (BAC), have even endorsed allocating a small portion of their portfolio to crypto.
That alone, Martin said, signals that crypto is here to stay.
Proponents also point to the broader adoption of crypto in real-world use cases. Cross-border payments are faster and cheaper. Remittances are more efficient. And tokenization enables the transacting of real-world assets, such as real estate, on the blockchain with fewer intermediaries. That has the potential to reshape the underpinnings of finance, Martin said.
To be sure, many near-retirees and retirees might be intimidated by the language of crypto, such as tokenization and blockchain. But Martin said these terms can be learned.
Blockchain is the underlying system that enables cryptocurrencies to move. It can be complex in implementation, but what most people need to know is this: It is public, anyone can see it, anyone can write to it, and once something is confirmed, it cannot be changed, he said.
It's not anonymous, although many people think it is, Martin said. It's pseudo-anonymous. Names aren't stored, but addresses — think of them like account numbers — are visible. That creates a level of transparency that is different from handing someone $20, which leaves no public record.
Tokenization refers to dividing a real-world asset, such as a fund, Treasury, real estate, or gold, into chunks on the blockchain. Instead of thinking about the blockchain as just moving currency, it can move virtually any asset.
A macro shot of a man's hand holding a bitcoin representation. (Nikolas Kokovlis/NurPhoto via Getty Images) · NurPhoto via Getty Images
The 3 biggest risks for crypto investors
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As many are aware, investing in crypto comes with risks that investors must understand before deciding whether digital assets belong in their long-term investment plans.
The first risk is market risk, Martin said. "Crypto is still a relatively volatile asset," he said. "It's also a relatively young asset. So prices can swing dramatically."
Bitcoin (BTC-USD), the world's largest cryptocurrency, dropped 18% in November, for instance, but has since started to recover some of those losses in December.
Ultimately, it's not the kind of asset that you want to invest in for the short term. Rather, it requires a long-term outlook and the ability to tolerate swings.
"You need to be able to ride out swings in asset value," Martin said. "And if that's too much risk for you. I think you should really think twice about crypto as an asset class."
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The second risk to contemplate is behavioral risk, Martin continued.
"There's a lot of fear and fear of missing out in crypto," he said. And so, if you're an emotionally driven investor who struggles to hold a long-term view, crypto may be a tough asset class.
The third risk is online security. You must protect your accounts and ensure your platform has strong safeguards, Martin said.
He offered this advice for those looking to make their first crypto purchase: Choose a platform or exchange that is regulated and subject to third-party audits or examinations. Ask yourself, how long has the company been in business? Who else trusts it?
Anyone considering a counterparty should also determine whether the platform fits their intended use. Are you a long-term buyer looking for a simple recurring purchase or an active trader requiring advanced tools? Pick a platform that matches your use case.
For someone dipping their toe in the world of crypto investing, ETFs provide easy exposure, Martin said. And if you later decide to engage more deeply in the crypto ecosystem, you can move to a platform that allows more actions than ETFs permit.
How much to allocate to crypto
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Financial experts often suggest that investors allocate 3% to 5% of their portfolio to crypto.
From his perspective, Martin adheres to a few principles when determining the right amount to allocate to cryptocurrencies
First, limit the downside. His personal rule of thumb is that if any risk-on asset were to go to zero, it should be disappointing but not life-changing. That often falls within the 3%-5% range, but it varies.
Second, use a dollar-cost averaging strategy. He recommended gradually building an allocation to crypto through small, regular purchases. That helps smooth out entry points.
And third, think about your core assets. Essential expenses should be funded by guaranteed or conservative income, such as Social Security, pensions, and conservative bond ladders.
Crypto, he said, should not be your grocery money. It should sit on top of those essentials.
What's ahead: Tokenization and regulation
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Looking ahead, what developments should retirees or new retirees watch for?
Martin said there will be more ETFs — both individual-asset and basket ETFs.
He also expects increased tokenization. The next major wave of financial innovation could mean faster settlement, lower costs, and wider access to asset classes that have been traditionally hard to access, he said. Even traditional equities may be tokenized in the future, allowing them to trade around the clock.
Improved regulations are another area to watch. The recent passage of the Genius Act and the Clarity Act, along with developments in Europe, are helping to build a stronger regulatory framework. And that, Martin said, "is a good thing for consumers because it gives them more confidence in the platforms, in the assets that they're investing in."
Finally, Martin said near-retirees and retirees should treat their first crypto investment as education, not a bet.
"We're not betting on the outcome of crypto over the next 30 days," he said. "After a decade in this space, I can't predict where the market is going in 30 days, and neither can anyone else. But crypto is becoming more central to the financial ecosystem, and understanding it will matter."
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