I remember the first time a board member asked me if their association should, and I quote: “put a little bit of their reserve funds into crypto.” He said it casually, the same way someone might suggest adding guacamole to a burrito. No big deal. Just a dab. Just a small taste.
I smiled politely, took a sip of the lukewarm coffee someone had generously brewed four hours earlier, and I casually said, “Let’s talk about what reserves actually are.”
Because here’s the problem: somewhere along the line, people started treating community association reserves like personal investment accounts. They aren’t. They never were. And they never will be.
So let me say this plainly. In my humble opinion, crypto has no place in community reserve funds. Not today, not tomorrow, not in any universe where board member fiduciary duty exists.
And this isn’t coming from someone afraid of innovation, I love technology. I love efficiency. After learning for almost half a century, I love what the future is bringing us.
But crypto and community reserves are like gasoline and campfires. Exciting to look at… until someone gets burned.
Reserves Are Not Poker Chips
When you’ve spent almost 50 years around HOA boards, balance sheets, and financial debacles, you learn something very quickly. That reserve funds are not “extra money”, they are not “growth capital”, and they are not “play money”. They are the lifeline of each community. They are the reason communities either thrive or barely survive.
These reserve dollars keep roofs overhead, asphalt under tires, water flowing, elevators lifting, buildings safe, and property values stable. Crypto, on the other hand, moves like a yo-yo in a hurricane.
One day it is up 12%. Next morning it is down 29%. Next week it’s “temporarily untradable due to system instability.”
This instability, my humble opinion, is too risky. You cannot fund a 2032 roof replacement with a 2026 meme coin.
Over the decades, I’ve watched many boards and communities try to “play it smart”. Some lost hundreds of thousands of dollars. Some lost sleep. Some lost their credibility and board seats. Every single one lost trust.
Fiduciary Duty Doesn’t Care About FOMO
Every time someone asks me about crypto, they eventually bring up FOMO, the Fear of Missing Out.
“What if we miss the upside?”
“What if we could double our reserves in five years?”
“What if we get ahead of every other community?”
Let me tell you a painful, personal secret from half a century of sitting at these tables: Boards don’t get sued for missing out on gains, boards get sued for losing principal. That’s exactly what the current crypto-craze threatens, not the upside, but the bottom line. Fiduciary duty isn’t about excitement. It isn’t about trends. It isn’t about “keeping up with the times.”
Fiduciary duty is about preserving capital, meeting future obligations, protecting homeowners, managing risk, ensuring liquidity and making decisions you can defend in court and their most valuable investment; their homes.
Crypto in its current configuration, fails every one of those tests.
Currently, There’s No Universal Regulation… Which Means There’s No Guaranteed Safety Net
If you’ve ever seen a market, industry or crypto exchange collapse in real time; and I have, you know exactly how fast things can go wrong…
Within hours your accounts can be frozen and your funds disappear. Customer Service goes silent and the regulators shrug because the FDIC doesn’t cover crypto. SIPC doesn’t cover crypto. No current State statutes recognize crypto as a permissible reserve instrument. And I believe that there is no court in America that would stand behind a board of directors that gambles reserve money on digital speculation. The HOA world is not the place for “the Wild West.” Community living requires predictability. And believe me, Crypto specializes in chaos.
Custody Alone Is a Nightmare
Let’s say, hypothetically, a board decided to buy crypto. Who holds the digital wallet?
The treasurer?
The community manager?
A volunteer?
A post it note on the fridge?
A USB drive in someone’s desk?
What happens when someone rotates off the board? What happens if a key is lost? What happens if the wallet is hacked? I’ve seen communities lose track of physical keys to the storage shed. And now we think we can track digital encryption keys worth millions. Crypto custody alone, is a full-time job, and some associations already have trouble keeping track of pool fobs.
The Biggest Risk Isn’t Volatility, It’s Temptation
Crypto has tapped into something emotional: the idea of easy wealth.
The idea that a community could get ahead overnight.
The idea that you found a shortcut no one else saw.
The idea that “we might be the first HOA to pull this off.”
But reserve funds do not exist to make anyone look brilliant.
They exist to keep the community standing.
HOAs don’t need brilliance. They need discipline.
What Boards Should Consider Instead of Crypto:
If you want real financial strength, the kind that assists homeowners instead of risking them, you need structure, not speculation. Boards should consider FDIC-guaranteed deposits, structured & safe investment vehicles, timeline-matched maturities, quarterly investment reviews, enforced Investment Policy Statement, reserve study updates and professional oversight.
The pressure boards face today is enormous. Inflation is real. Maintenance is expensive. Insurance is unpredictable. And yes, homeowners resist maintenance fee increases at every turn. It’s tempting to chase shortcuts. But shortcuts are how many communities fall behind.
The real courage in 2026 isn’t investing in crypto. It’s looking homeowners in the eye and saying, “We are going to guard your investment by doing this the right way.”
Crypto might double overnight, but it also might disappear overnight. I think most readers will agree, your community cannot afford either outcome.
A Final Thought…
Crypto is exciting. It’s innovative. It’s evolving. It may in fact reshape parts of the financial world in extraordinary ways. But one place it cannot and currently should not exist is in the reserve portfolio of a community association. Your homeowners didn’t buy into a technology incubator, they bought into a community, a neighborhood and most importantly, a promise. Honor that promise with stability, not speculation.
Helping You Build a Firm Financial Foundation For Your Future
Nico F. March is the Managing Director of The March Group, LLC. He has worked with Community Associations since 1974 and has served on several Boards, including the Board of Directors for the Community Association Institute (CAI), San Diego Chapter.
His team has specialized in Corporate Cash and Association Financial Management since 1982 and has assisted over 1000 Associations, Nonprofits and Timeshares invest reserve, operating, tax impound, SIRS and reconstruction funds. Nico and his team work out of their San Diego, Florida and Wyoming offices and may be reached at 888.811.6501 or email [email protected] for further information and consultations.
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
This is a hypothetical situation based on real life examples. Names and circumstances have been changed. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investments or strategies may be appropriate for you, consult your advisor prior to investing.
LPL- 826911-01-02
