What to know about the future of pensions and crypto

Institutional crypto is increasing in popularity and scope. An intriguing, and relatively new, area in which crypto interest is being garnered - especially among younger generations - is pensions. This blog breaks down what there is to know about pensions and crypto and how they might shape each other in the future. 

Crypto and pensions

Pension funds are not known for being big risk-takers, and are traditionally conservative with their investment choices. However, even large, old-fashioned pension funds are beginning to look into crypto (specifically Bitcoin). Although pension exposure to Bitcoin is only small, this is a marked change from previous years where there has been very little interest in the potential for digital assets to become part of pension portfolios. 

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Demographic interest

There’s strong evidence that younger generations are interested in crypto with regard to their future pensions. A recent survey by Bitget Research reported that up to 20% of Gen Z and Alpha are open to receiving pensions in crypto. 78% of respondents also expressed more trust in ‘alternative retirement savings options’ over traditional pensions. Younger adults are keen on diversifying their economic options and are no longer fixed on fiat opportunities. These generations are also interested in crypto more generally, already have significant crypto investments, and believe cryptocurrencies are the ‘new version’ of buying a first home. 

Older generations are significant investors in crypto, but there aren’t as many of them. Gen X and baby boomers are much more cautious and conservative about their most important investments, and although they incorporate crypto into their portfolios they do not have the same level of trust. As these are largely the demographics in charge of existing pension funds, it goes some way to explain the refusal to move fund portfolios into digital assets.

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Pensions and crypto - the negatives

The main arguments by naysayers of pension funds and crypto revolve around volatility, cybersecurity, and regulatory uncertainty. 
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Cybersecurity. Pensions are vulnerable to cybersecurity attacks, and so are digital assets. In 2024, hackers stole over $2.3 billion worth of crypto, an increase of 40% over 2023.  Safety infrastructure to ensure the integrity of funds can be complicated and costly.

Regulatory uncertainty. Although there is better regulatory clarity around crypto more generally, there are still many questions about legal frameworks, insurance, and safety. If there is no regulation, there will be no appetite for taking the associated risks with crypto portfolios in pensions.

Volatility. Crypto is volatile, there’s no getting around that. The risks associated with that volatility might be too large when dealing with someone’s pension. 

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What has changed 

Why are pension funds suddenly opening up to the idea of crypto? As recently as late last year, many advisors were decrying any interest by pension funds in cryptocurrencies. But the wave of news around pensions and crypto has begun in 2025. This could be down to two things: Bitcoin, and a new government in the US. Bitcoin is hitting mainstream headline news, and its price movements are closely followed. With this comes an increased reputation and more user education. As changes are felt in the White House and a new pro-crypto regime begins, it has settled a lot of nerves around crypto and Bitcoin.

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Whether these changes will start a significant change to cryptocurrencies in pension portfolios, or simply a marked increase in interest in future potential, remains to be seen. However, it's clear that, as in many other areas of institutional crypto, the possibilities are beginning to open up.

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