SINGAPORE – Investors young and old are piling into cryptocurrency, lured by seductive tales of instant millionaires, despite the wild swings, a slew of horror stories of savings lost to such investments and a lack of understanding of these assets.
Crypto ownership among Singaporeans has been rising across most age groups, according to a survey conducted between late January and February. Even older folk, who previously had reservations about crypto, are now dabbling in digital assets.
Observers tell The Straits Times that the market has matured since the early days, when institutional investors and super-rich investors were predominant. Today, even retail investors are adopting crypto as part of their portfolios.
Younger investors are no longer willing to wait many years for financial security. They are impatient to build their wealth, viewing crypto as both opportunity and hope.
The conflict in the Middle East is shaking global stability, while rising costs, climate risks and job uncertainty are already weighing on daily life.
In such an environment, these investors wonder whether they will even live long enough to reap the benefits of long-term investing, prompting them to turn to crypto for faster returns.
People still want a shot at building wealth, says Mr Zachary Young, founder of Atlantis Labs and chief executive of crypto education platform CryptoKnight Academy.
But enthusiasm without comprehension is dangerous, says Mr Young, who has guided more than 40,000 newcomers to make sense of the crypto space, which requires discipline to participate in.
Many investors are diving into crypto based on social media content, group chats and viral tips – places where there is plenty of noise, but very little structure. This can be costly.
“The problem isn’t that young people are getting into crypto early – this can be a positive – but that many enter without the discipline, appropriate position sizing and risk management needed to navigate such a volatile market,” he says.
He talks about the crypto investment journey of a student in the healthcare sector. In 2017, the student placed his bitcoin into a staking platform that later disappeared, and lost half a bitcoin.
The incident caused the student to walk away from crypto until 2024 when he embarked on a journey to learn about digital assets properly.
With proper education on risk awareness, portfolio thinking and knowledge of how the market actually behaves, he stopped relying on emotions and began approaching trading in a disciplined and systematic way.
Over time, his bitcoin holdings grew from three to five, with 2.2 bitcoins earned through options trading over 16 volatile months.
Without a real grasp of risk, discipline or market cycles, many lose money early, then walk away blaming the technology.
Young investors often act more aggressively, think more short term and trade more emotionally, Mr Young says.
This behaviour usually manifests in taking on positions that are too large, hanging on to losing trades for too long, and reacting to price movements instead of sticking to a plan.
Over time, this combination can lead to greater losses than necessary, especially in the crypto market due to the highly volatile nature of the assets, which trade 24/7 and experience wider price swings than those of traditional asset classes.
Mr Young says the kind of upside crypto can potentially offer is extremely rare in traditional asset classes.
“That is why crypto is especially attractive to people chasing upside, but also dangerous for younger and less financially experienced investors. The opportunity is bigger, but so is the cost of entering without discipline,” he adds.
Investing is as much about managing volatility as it is about chasing returns, so it pays to ease in, says Mr Hassan Ahmed, Singapore country director for Coinbase, the largest crypto exchange in the US. The company has received in-principle approval from the Monetary Authority of Singapore (MAS) to offer payment services here.
Follow a simple framework, Mr Ahmed suggests: Choose an onshore regulated platform; secure your account with two-factor authentication; start with stablecoins such as USDC to learn the basics; then gradually explore major assets like Bitcoin and Ethereum.
He tells young crypto enthusiasts that the biggest risk in a high-volatility environment is making decisions based on prices alone and skipping research entirely.
While the crypto adoption rate is growing rapidly here, education has not kept pace. A report by Coinbase and MoneyHero in 2025 found that 62 per cent of respondents learnt about crypto via social media, which carries a risk of misinformation.
It is better to understand what you own, why you own it and how it fits into your financial plan – that is the foundation of responsible participation, Mr Ahmed says.
Mr Young says that volatility, if properly managed, can help avoid serious losses and present many opportunities.
Education is a critical first step. Concepts like blockchain fundamentals, tokenomics and market structure may seem tedious, but they underpin every informed trade. Without understanding them, investors are essentially gambling.
The second step is establishing a disciplined system for taking profits and cutting losses.
Responsible trading, Mr Young says, is not about guessing every move right. It is about having clear rules, following them regardless of mood or market noise, and managing risk.
Third, crypto portfolios should mirror the diversification philosophy of any investment portfolio. Avoid concentration in a single token or exchange.
“I wouldn’t say crypto trading is ever 100 per cent safe. In reality, very few financial products are. ‘Safer’ does not mean risk-free; it means controlling risk,” Mr Young says.
For instance, if you put only 5 per cent of your portfolio into one crypto position, even if that asset goes to zero, you lose only 5 per cent of your capital.
This is what safer participation looks like, not eliminating losses entirely, but limiting them so that no single mistake can significantly harm you.
Safety comes from knowing how to size positions, manage risk and limit losses. This is what responsible participation is about: discipline, not prediction.
Every investment has its own cautionary tale. For the crypto community, it carries the names of Luna and FTX, whose crashes wiped out billions of dollars and exposed the vulnerabilities of trusting unregulated platforms.
Mr Ahmed says the two incidents shared a common theme – investors did not have clear visibility into what was backing their assets.
Before plunging into a project, investors must ensure that there is a channel to verify what is happening with their money, either through attestation reports or audits.
Beyond one’s own due diligence, the safeguard available to Singapore investors is regulation. MAS’ strict regulations do a good job of providing a baseline of accountability that unregulated platforms cannot offer.
“That does not make a licensed platform risk-free, but it does mean that rules, reporting requirements and recourse mechanisms are in place. For any investor, treating accountability as a non-negotiable is one of the best ways to reduce exposure,” Mr Ahmed says.
Mr Young’s takeaway from the Luna and FTX crises is that most people who lost money in crypto did so because they allowed someone else to manage or hold their funds.
Whether it was a yield platform promising outsized returns or a centralised exchange that imploded, the pattern was similar: investors outsourced responsibility.
In traditional finance, intermediaries like banks and brokers are governed by clearly defined protections. In crypto, those lines are blurred.
This is why self-custody, or controlling your own private keys, is becoming a core tenet of responsible participation. Keeping assets in a cold wallet, disconnected from the internet, ensures that even if an exchange collapses, coins remain under your control.
“The lesson from major failures like Luna and FTX is that people should not rely blindly on platforms, promises or personalities. They need to perform due diligence, diversify and control how their assets are stored,” Mr Young says.
For a first-time investor, crypto can be both thrilling and bewildering. New coins launch almost daily, social media teems with hype, and the jargon can feel like a foreign language.
Beyond the simple framework suggested, Mr Young says there are several crucial questions every beginner should ask.
First, how much money can you afford to lose?
Crypto is inherently volatile – prices can halve in weeks. No one should invest more than they can afford to lose.
Second, who holds the asset?
When using a centralised exchange to buy crypto, you should not assume the exchange is a bank. Understand who controls the private keys. Many start with exchanges for convenience, but gradually learn self-custody once they are comfortable.
Third, what exactly are you investing in?
Not all coins are created equal. Beginners should focus on established assets like Bitcoin or Ethereum with proven security track records, instead of chasing the latest meme token. Novelty carries risk.
The biggest pitfalls include overinvesting, chasing trends, buying assets you do not understand, and entering the market without a clear plan.
It is best to start small, keep things simple, and concentrate on building knowledge before attempting to chase returns, experts say.
Investors in Singapore should approach crypto as a maturing asset class, but one that still requires discipline and a clear risk mindset, Mr Ahmed says.
Much of the downside comes from how people enter the market: chasing quick gains, over-allocating, or jumping into highly volatile assets too early.
“It’s important to avoid the fast money mindset and focus on diversification instead of short-term price swings,” he says.
There are also structural risks to be aware of, particularly around where and how you invest. Counterparty risk remains significant when using offshore or unregulated platforms, where custody and governance standards can vary widely.
This is why it is important to use trusted, regulated platforms for both investing and on- and off-ramping funds, alongside basic protections like two-factor authentication.
One issue people often ignore is inheritance and succession planning. In traditional finance, if someone dies, family members typically can work with a bank or institution to recover assets.
In crypto, since assets can be self-custodied and decentralised, there may not be a central party to contact, Mr Young says.
This means investors need to think carefully about how they securely store seed phrases, passwords and access instructions to ensure that loved ones are not shut out from those assets if they die or become incapacitated.
Ultimately, navigating crypto safely comes down to a combination of platform choice and investor education. Those who stay disciplined, diversify, and prioritise security are better equipped to handle volatility, Mr Ahmed says.
