US Mortgage Market Embraces Crypto-Collateralized Lending

The token-backed mortgage initiative is a significant development in the intersection of cryptocurrency and traditional finance. Better Home & Finance and Coinbase have partnered to offer the first token-backed conforming mortgage, which carries Fannie Mae backing.

Under this structure, borrowers can tap their verified crypto holdings to cover down payments and closing costs without having to sell their assets. This sidesteps the capital gains tax hit that would come from cashing out, making it an attractive option for Bitcoin holders who want to leverage their wealth without triggering a taxable event.

The policy pipeline behind this initiative began with Federal Housing Finance Agency Director Bill Pulte's directive in June 2025, which directed Fannie Mae and Freddie Mac to explore integrating digital assets into mortgage risk assessments. This regulatory groundwork laid the foundation for what launched nine months later.