US Mortgage Lender Partners with Coinbase for Crypto-Collateralized Loans

A new mortgage lending product in the US has made headlines for accepting Bitcoin and USDC as collateral. Partnering with Coinbase, Better Mortgage is set to launch nationwide this summer.

The lender's collaboration with the crypto exchange will power transactions behind the scenes. Borrowers will connect through Coinbase's interface, apply for a loan, get approved, and authorize their cryptocurrency to be transferred into a custodial wallet.

This setup provides borrowers with confidence, as their Bitcoin remains secure in custody rather than being sold off to cover a down payment. The product is significant, as it involves Fannie Mae's backing, which makes the loan a standard financial instrument.

According to Vishal Garg, Better Mortgage's founder and CEO, this backing amounts to a US government-sponsored enterprise accepting digital assets in place of cash held in a bank account as collateral. The product is expected to expand beyond Bitcoin and USDC to other digital assets, including tokenized stocks, over time.