Key Takeaways
- Fannie Mae has launched a program allowing cryptocurrency to serve as collateral for mortgage down payments in partnership with Coinbase and Better Home & Finance.
- Homebuyers can use Bitcoin or USDC as pledged assets, preserving their crypto holdings while avoiding liquidation and associated capital gains taxes.
- The program operates through a dual-loan mechanism: a traditional Fannie Mae mortgage combined with a crypto-collateralized loan.
- Interest rates on the crypto-backed portion may exceed standard mortgage rates by up to 1.5 percentage points.
- This initiative stems from FHFA Director Bill Pulte’s June 2025 mandate directing Fannie Mae and Freddie Mac to explore cryptocurrency integration in mortgage finance.
Fannie Mae, the government-sponsored enterprise managing $4.1 trillion in mortgage assets, has introduced a groundbreaking program allowing homebuyers to utilize cryptocurrency as collateral for down payments. This initiative represents a collaboration with Coinbase and mortgage provider Better Home & Finance.
The concept centers on enabling homebuyers to maintain their cryptocurrency investments while accessing mortgage financing. Instead of liquidating digital assets to generate down payment funds, borrowers can pledge these holdings as security.
The financing arrangement involves two separate loan components. One component consists of a conventional 15- or 30-year mortgage backed by Fannie Mae. The other represents a crypto-secured loan that provides the necessary down payment capital.
Currently, the program accepts Bitcoin and USDC as eligible collateral. Throughout the loan duration, these pledged digital assets remain locked and unavailable for trading.
Better CEO Vishal Garg stated that mortgage obligations remain unaffected by cryptocurrency market volatility, provided borrowers maintain regular payment schedules. This design feature addresses a significant concern associated with crypto-collateralized lending products.
Understanding the Two-Loan Framework
The financing arrangement carries higher costs compared to traditional mortgages. Borrowers must service interest payments on both loan components. The cryptocurrency-backed portion may carry rates comparable to standard Fannie Mae mortgages or reach premiums up to 1.5 percentage points above baseline rates.
Coinbase’s Max Branzburg explained that cryptocurrency holders have historically faced barriers to homeownership due to reluctance to liquidate assets and incur substantial capital gains tax liabilities. This product provides an alternative pathway.
Fannie Mae operates by purchasing mortgages from originating lenders, securitizing these loans, and guaranteeing investor payments. This institutional backing provides legitimacy that previous crypto mortgage offerings from smaller financial companies could not match.
Previous Market Entrants
Crypto-collateralized mortgages existed before this announcement. Miami-based fintech company Milo introduced a comparable product in 2022, subsequently serving approximately 100 clients.
Milo CEO Josip Rupena noted that his customer base typically includes international buyers who possess substantial assets but lack extensive traditional credit profiles. This represents a specialized but expanding market segment.
Newrez, a non-bank mortgage lender, has begun accepting specific cryptocurrency holdings in mortgage applications without requiring asset conversion. These developments signal growing mainstream adoption of digital assets in lending.
Regulatory Framework
This program emerged following Federal Housing Finance Agency Director Bill Pulte’s June 2025 directive. He mandated that Fannie Mae and Freddie Mac investigate methods for incorporating cryptocurrency assets into mortgage underwriting processes.
Gallup data indicates that approximately 14% of American adults held cryptocurrency in 2025. Redfin research revealed that nearly 13% of younger homebuyers had liquidated crypto assets to finance down payments.
Specific program parameters remain under development. Outstanding questions include collateral valuation methodologies and risk management protocols that will govern the program’s operation.
