Tyson, 53, recently returned to training and the former world champion has said he would be interested in donning the gloves again for some charity exhibition fights.
The possibility of the two fighting each other once more appears very real, with Holyfield confirming that though nothing had been agreed yet, it was "coming that way".
Promoter Eddie Hearn suggested it would be "a bit irresponsible" to allow Tyson to return to the ring given his age, but Holmes, who was a heavyweight champion for seven years between 1978 and 1985, does not agree.
"If these guys want to do it, I'd say go ahead and do it, I'm not going to say don't do it," said Holmes, who was speaking on behalf of @trcksuits.
"They get a chance to show what they got and if they look good enough, they're probably going to get an opportunity to fight somebody in the top 10 [heavyweights]."
Tyson and Holyfield have met twice before, in 1996 and 1997.
Holyfield won the first meeting with an 11th-round stoppage that saw him take Tyson's WBA belt.
The second fight ended in dramatic circumstances when Tyson was disqualified for biting Holyfield's ears, acts that led to a hefty fine and suspension.
If the two meet for a third time, Holmes believes Holyfield would have the psychological advantage.
"Evander Holyfield is a good fight for Mike Tyson, but it's also a bad fight because Holyfield knows him," he added.
"He fought him, beat him up. So Mike Tyson would have to worry about that, he's going to worry about it, it will be in his mind - 'Holyfield can hit me with this, that, this'.
"He will try to be careful and that might hurt him."