Mortgage Rule Change Adds Crypto. What Homebuyers Should Know

Forbes

26-06-2025

AUSTIN, TEXAS - A home available for sale as a new FHFA directive allows borrowers to use Bitcoin ... More and other approved cryptocurrencies as mortgage reserves, signaling a major shift in U.S. housing policy and crypto adoption. (Photo by)
Crypto to Count in Mortgage Approvals Under New Federal Housing Rule
In a seismic shift for U.S. housing policy, the Federal Housing Finance Agency has ordered Fannie Mae and Freddie Mac to find ways to treat cryptocurrency as a legitimate reserve asset in mortgage risk assessments. Signed June 25, 2025, by FHFA Director William J. Pulte, the order means that Bitcoin and a short list of compliant crypto holdings could soon help borrowers qualify for conventional home loans, without converting their assets into dollars.
Pulte made the announcement on X, saying he has "ordered the Great Fannie Mae and Freddie Mac to prepare their businesses to count cryptocurrency as an asset for a mortgage."
The move aligns with President Donald Trump's push to make America 'the crypto capital of the world.' Under the directive, the mortgage giants must develop internal frameworks to evaluate crypto held on U.S.-regulated exchanges, factor in volatility, and submit final proposals to their boards and the FHFA for approval.
Fannie and Freddie's Crypto Shift Could Change Mortgage Standards Nationwide
Fannie Mae and Freddie Mac, which back more than half of all U.S. mortgages, do more than support lending. They set standards that the entire housing market follows. When their credit criteria change, private lenders take notice.
After the 2008 financial crisis, both were placed under federal conservatorship to stabilize the housing system. Now, they are helping to redefine it.
This decision resolves a long-standing paradox for crypto holders. Previously, anyone hoping to use digital assets toward a down payment or reserve requirement had to sell first and pay capital gains tax. The new guidance allows borrowers to retain qualifying crypto, avoid triggering a tax bill, and still meet mortgage underwriting criteria.
With 64.9% Market Share, Bitcoin Cements Itself as Crypto's Most Trusted Asset
A full list of qualifying digital assets has not yet been released, though Bitcoin is expected to be included.
Bitcoin now accounts for 64.9 percent of the entire crypto market. This level of dominance signals that Bitcoin is seen as the most trusted and proven digital asset, offering more stability than any other token.
It also reflects the emergence of a deep, maturing asset class that traditional lenders may now begin to treat more like cash or Treasuries.
Mortgage Policy Lets Buyers Use Crypto Without Triggering Taxes
With the potential for crypto assets to guide loan decisions, there are practical benefits for certain borrowers. Recognizing crypto as a reserve asset could lower barriers for first-time and lower-income homebuyers. Currently, using digital assets toward mortgage qualifications often requires selling, which results in capital gains taxes.
The new approach allows borrowers to retain qualifying crypto and potentially avoid tax consequences. It may also improve approval odds, as reserve assets are considered a compensating factor in underwriting. Applicants with limited income but sufficient crypto holdings could present a stronger financial position. Additionally, the change may reduce the need for some households to tap home equity to acquire digital assets, instead allowing existing crypto holdings to support home purchases.
Fannie Mae Research Highlights Crypto's Potential to Ease Home Buying Barriers
Allowing crypto to count toward mortgage underwriting could expand access to homeownership, particularly for younger and more diverse populations, who are more likely to hold digital assets. Current guidelines often require liquidation of crypto to meet reserve or down-payment requirements, resulting in taxable events and reduced exposure to a historically high-performing asset. Fannie Mae research states that down-payment constraints remain a leading barrier for Black and Latino borrowers, and revised policies could help address this gap.
Bitcoin's historical volatility has declined as the asset has matured and its market capitalization has increased. Similar to gold's early behavior, Bitcoin experienced high volatility during its early years but has shown a downward trend in price fluctuations over time.
Only Exchange-Held Crypto Qualifies Under New Mortgage Guidelines
Based on Pulte's letter, only crypto held at U.S.-regulated exchanges will qualify under the new guidelines. This approach simplifies know-your-customer compliance but excludes borrowers who self-custody their assets on hardware wallets, which is a common practice among crypto users. While it may be possible to temporarily transfer assets to approved custodians to meet underwriting requirements, doing so introduces additional steps and complexity for borrowers.
Investors in mortgage-backed securities will likely need to determine the updated risk profile digital assets present. Credit rating agencies, which are not under direct federal oversight, may review the performance of crypto-backed mortgages before deciding on their eligibility for inclusion in government-backed mortgage pools. The outcome may influence the timeline and extent of adoption within the broader housing finance system.
Crypto Lenders See Momentum as FHFA Opens Door to Digital Assets
Milo, a Miami-based fintech that has issued over $65 million in crypto-backed mortgages, responded to the order on X, saying,
'If the FHFA embraces this path, it could mark a major shift in how modern wealth is recognized in mortgage lending.'
The company offers up to 100 percent financing without liquidating Bitcoin or Ether. Until Fannie Mae and Freddie Mac officially adopt their own standards, specialty lenders like Milo act as a simulation for broader implementation.
Trump's Crypto Agenda Raises Questions for Mortgage Policy and Market Stability
The proposed order underscores a broader shift in how crypto is treated under federal policy since President Trump began his second term. In January 2025, President Trump appointed Pulte as director of the FHFA, aligning housing oversight with the administration's focus on digital assets.
Initiatives like the Strategic Bitcoin Reserve and pledges to make 'America the crypto capital of the world' signal a deeper integration of crypto into traditional finance. Extending that approach to mortgage lending brings it into a sector that touches nearly every American household.
President Trump has also engaged personally in crypto markets through branded NFTs and public support for specific digital assets. His involvement has prompted scrutiny over whether political appointments and regulatory moves could influence projects with which he or his associates are connected.
Plenty of Unanswered Questions With Proposed Mortgage Rules
Several questions remain regarding if, and how, the policy changes will be implemented. Bitcoin is expected to qualify, but it is unclear whether stablecoins that aim to maintain dollar parity will be included.
Additional considerations include whether self-custodied wallets will be allowed or if only assets held on regulated platforms will qualify. Advocacy groups continue to raise this issue in policy discussions. It is also unclear whether income from staking or mining will be counted in the future. The current order applies only to reserves and does not address income calculations used in loan underwriting.
Weighing the Risks and Benefits of Crypto-Backed Mortgages
Allowing crypto to count toward mortgage reserves could offer several benefits. Borrowers may avoid triggering capital-gains taxes by holding rather than liquidating digital assets. The policy could also expand credit access for younger and more diverse households that primarily hold crypto. It aligns U.S. housing finance with broader digital-asset adoption and may encourage fintech innovation while supporting domestic tech talent.
There are plenty of risks to consider as well. Because crypto prices can change quickly, the value of a borrower's reserves could drop, making the loan riskier. Verifying the value and ownership of digital assets may be difficult, especially with concerns about fraud. Investors who buy mortgage-backed securities might require higher returns to account for this added risk.
Bottom Line
The FHFA's order does not designate crypto as legal tender or guarantee broad access to home loans for digital asset holders. However, it formally recognizes that certain cryptocurrencies can play a role in mortgage reserve calculations. By allowing borrowers to include Bitcoin and other eligible digital assets, the agency has introduced a new consideration into housing finance and regulatory frameworks.
The impact of this policy will depend on how it performs in practice. If effective, it may expand access to homeownership for individuals holding appreciated crypto assets without converting them to cash. If challenges emerge, the outcome could affect the stability of the government-sponsored enterprises involved. The program will serve as a test of how digital asset holdings interact with traditional mortgage standards.