Fannie Mae Introduces Crypto-Backed Mortgages

Fannie Mae has made a significant move in the world of mortgage lending by introducing crypto-backed mortgages. The Federal National Mortgage Association (FNMA) will now accept Bitcoin as collateral, allowing homebuyers to use their digital assets to purchase a property.

The new policy removes the requirement for borrowers to convert their cryptocurrency into USD before applying for a mortgage. This change is designed to mitigate volatility risks and provide several benefits to borrowers, including no margin calls and tax efficiency.

The crypto-backed mortgage program is split into two components: the conforming mortgage and the token-backed pledge. The conforming mortgage covers the bulk of the home price, while the token-backed pledge provides a separate loan for the down payment, secured by Bitcoin or USDC held in a Coinbase Prime custody account.