The U.S. Federal Housing Finance Agency (FHFA) is exploring whether cryptocurrency holdings should be considered in mortgage applications, a move that could reshape home financing during an ongoing housing affordability crisis. Director Bill Pulte announced the agency will study integrating digital assets like Bitcoin into mortgage qualification processes, potentially allowing Americans to leverage crypto wealth for home loans.
This regulatory shift follows the repeal of the Securities and Exchange Commission’s controversial SAB 121 rule in January 2025, which previously barred banks from holding digital assets for clients. The elimination of this accounting barrier now enables traditional financial institutions to consider cryptocurrency as legitimate collateral.
Research indicates a growing trend of lower-income families using crypto investment profits to pay off mortgages, highlighting the real-world demand for such financial flexibility. The FHFA’s review could formalize these practices within mainstream banking.
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FHFA’s Mortgage Qualification Study
The agency’s examination focuses on whether cryptocurrency assets can meet the same standards as traditional assets in mortgage underwriting. Pulte confirmed via social media that the FHFA will “study the usage of cryptocurrency holdings as it relates to qualifying for mortgages,” signaling a potential paradigm shift in housing finance.
If implemented, this policy would mark the first federal recognition of digital assets in mortgage lending. Current guidelines from Fannie Mae and Freddie Mac—the government-sponsored enterprises regulated by FHFA—prohibit crypto considerations, forcing applicants to liquidate digital holdings before applying.
Industry analysts suggest the review could conclude within 12-18 months, with pilot programs potentially launching in crypto-friendly states like Florida or Texas. The move aligns with broader Treasury Department efforts to modernize financial infrastructure for digital assets.
Impact of SAB 121 Repeal
The reversal of SEC Bulletin 121 removed critical regulatory barriers that prevented banks from custodying digital assets. Previously classified as liabilities on balance sheets, crypto holdings created capital requirement complications that discouraged institutional involvement.
With these restrictions lifted, traditional lenders can now develop crypto-backed loan products without regulatory penalties. Major banks including JPMorgan and Wells Fargo are reportedly exploring crypto collateralization frameworks in anticipation of FHFA’s decision.
Specialized firms like Figure Technologies already offer crypto-backed real estate loans with strict collateral requirements—typically 150-200% loan-to-value ratios. These private lenders automatically liquidate positions if crypto values drop below predetermined thresholds.
Emerging Crypto Mortgage Solutions
While traditional mortgages remain inaccessible for crypto holders, alternative solutions have emerged:
| Provider | Collateral Requirement | Key Feature |
|---|---|---|
| Figure Technologies | 150% LTV | Automated liquidation triggers |
| Ledn | 200% LTV | Bitcoin-only collateral |
| YouHodler | 170% LTV | Multi-coin acceptance |
These platforms demonstrate viable models for crypto-backed lending, though they lack federal insurance protections. FHFA’s potential endorsement could bring similar products to FDIC-backed institutions with lower interest rates.
The housing affordability crisis—with median home prices exceeding $400,000—creates urgency for alternative financing models. A Federal Reserve study shows 34% of crypto investors hold digital assets specifically for real estate objectives.
Critics warn of crypto’s volatility creating systemic risk, while proponents argue blockchain-based property transactions could reduce closing costs by 40%. The FHFA study will evaluate these competing concerns through stress tests simulating crypto market crashes.
Market analysts predict mortgage lenders could accept stablecoins first due to their price stability, with Bitcoin integration following later. This phased approach would mitigate initial volatility concerns while establishing regulatory frameworks.
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This regulatory evolution could significantly expand homeownership access for the estimated 52 million Americans holding cryptocurrency. By recognizing digital assets as legitimate wealth, the FHFA may unlock $128 billion in previously illiquid capital for housing markets.
- FHFA
- The Federal Housing Finance Agency regulates Fannie Mae, Freddie Mac, and Federal Home Loan Banks to ensure housing market stability.
- SAB 121
- The SEC’s accounting bulletin requiring institutions to list crypto holdings as liabilities, repealed in January 2025.
- Crypto-backed mortgage
- A loan using cryptocurrency as collateral, requiring overcollateralization to mitigate volatility risks.
- Stablecoins
- Cryptocurrencies pegged to stable assets like the US dollar, designed to minimize price fluctuations.
