Key Summary

The debate over crypto in retirement accounts hinges on position sizing, since Bitcoin's drawdown profile — repeated 70-80% peak-to-trough declines historically — sits awkwardly with the sequence-of-returns risk that dominates near-retirement portfolios. The transmission channel to watch is retirement-plan access: if 401(k) menus and target-date structures broaden crypto allocations, BTC gains a slower, less price-sensitive bid similar to spot ETF flows, but that same buyer base is more likely to liquidate into equity drawdowns, tightening BTC's correlation to NASDAQ and S&P 500 beta. No specific allocation threshold is set here, so the confirmation point is plan-sponsor and regulatory guidance on permitted crypto weightings, plus whether realized BTC volatility compresses toward the 30-40% range that institutional allocators can size around.