Crypto-Based Mortgages Gain Traction in US Housing Market

Crypto-based mortgages are gaining traction in the US housing market, thanks to a new partnership between Coinbase and home lender Better.

The two companies have rolled out a mortgage program that allows borrowers to use digital assets as collateral for their loans, without having to liquidate them. This means that homeowners can retain ownership of their cryptocurrencies while still accessing traditional mortgage financing.

The mortgages are backed by Fannie Mae, the government-sponsored enterprise that supports liquidity in the US housing finance system. The structure follows Fannie Mae's guidance allowing bitcoin and US dollar-pegged stablecoins to be used as collateral for certain home loans.

Better combines the crypto-backed loan with a traditional mortgage, offering borrowers a single monthly payment with one interest rate and term. When using bitcoin as collateral, its value must be at least 250% of the down payment loan amount. For stablecoins, the requirement is 125%.

According to Vishal Garg, Founder and CEO of Better, this new structure aligns with how many Americans now hold their wealth in digital assets, rather than just traditional bank deposits. The company's goal is to make it easier for borrowers to access mortgage financing using their cryptocurrencies.