The United States Federal Housing Finance Agency (FHFA) has announced plans to examine whether cryptocurrency holdings can be factored into mortgage qualification assessments.
The move stands as a major win for the industry and could mark a significant shift in how digital assets are viewed within traditional financial systems.
FHFA Director William Pulte, nominated by President Donald Trump, shared the news via a post on X (formerly Twitter), stating that the agency would study how crypto assets could influence a borrower’s eligibility for home loans.
FHFA Move Signals Growing Recognition of Crypto in Personal Finance Portfolios
The initiative reflects growing recognition of digital assets like Bitcoin and Ethereum as part of individuals’ broader financial portfolios.
Traditionally, mortgage qualification depends on income, credit scores, and verifiable liquid assets held in banks.
However, as more Americans invest in and hold cryptocurrencies, questions have emerged around how these holdings could be securely and fairly assessed as part of financial applications.
If implemented, this could open new pathways for crypto-savvy individuals to access homeownership, while also posing regulatory and valuation challenges for lenders and underwriters.
The FHFA’s study signals a willingness to modernize mortgage frameworks in line with evolving financial behaviors.
It could also influence other federal agencies and lenders to begin considering digital assets as a legitimate form of financial strength.
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SEC Rule SAB 121 Had Restricted Banks from Offering Crypto-Backed Loans Until January 23
Until January 23, most major U.S. banks were restricted from offering crypto-backed loans or mortgages due to SEC Staff Accounting Bulletin No. 121 (SAB 121).
This guidance required publicly listed companies to report any crypto assets held on behalf of clients as liabilities on their balance sheets.
As a result, banks faced higher capital requirements and compliance burdens, making it financially unattractive to engage with crypto-based financial products.
The rule effectively discouraged traditional banks from integrating cryptocurrencies into their lending or mortgage operations.
However, with growing interest in digital assets and ongoing regulatory discussions, these limitations are now being reconsidered, potentially opening the door for crypto-friendly mortgage products and broader institutional involvement in the digital asset economy.
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Crypto-Backed Mortgages Remain Limited to Niche Digital Lenders
Crypto-backed mortgages already exist but are currently limited to niche financial firms that specialize in digital asset lending.
These companies allow borrowers to secure fiat loans—often for real estate—by locking up cryptocurrencies like Bitcoin or Ethereum as collateral.
However, these loans usually require high collateralization, sometimes exceeding 150% of the loan’s value. If the crypto collateral drops in value, borrowers must add more assets to avoid liquidation in a margin call.
With the FHFA now studying the role of crypto in mortgage qualification, this landscape may evolve.
Traditional banks could begin offering similar products, or new hybrid lending models may emerge, blending conventional mortgage processes with blockchain-backed financial flexibility.
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