The US Federal Housing Finance Agency (FHFA) has ordered home mortgage purchasers Fannie Mae and Freddie Mac to consider how to count cryptocurrencies as assets in their risk assessments for some home loans.
FHFA director William J. Pulte told both of the government-sponsored enterprises (GSEs) in a letter on Wednesday to “prepare a proposal for consideration of cryptocurrency as an asset for reserves in their respective single-family mortgage loan risk assessments, without conversion of said cryptocurrency to U.S. dollars.”
The order means the two GSEs could consider potential borrowers’ crypto holdings when they apply for a mortgage, which Pulte said “has not typically been considered” in mortgage risk assessments without first converting the crypto to US dollars.
The FHFA has overseen Fannie Mae, or the Federal National Mortgage Association, and Freddie Mac — the Federal Home Loan Mortgage Corporation — since 2008, when both institutions were placed under government conservatorship in the aftermath of the 2008 financial crisis.
Fannie Mae and Freddie Mac have played a critical role in the US housing market since the subprime mortgage crisis, providing liquidity and stability by purchasing mortgages from lenders, which enables lenders to issue more loans.
Pulte said on X that the decision to include cryptocurrencies as part of the mortgage risk assessment came “after significant studying” and aligns with Donald Trump’s goal to make the US the “crypto capital of the world.”
Pulte’s letter said the two enterprises should only consider cryptocurrencies “that can be evidenced and stored on a U.S.-regulated centralized exchange subject to all applicable laws.”
Related: US home mortgage regulator considers Bitcoin amid housing crisis
Crypto is gaining acceptance as mainstream collateral in the United States
The decision to recognize cryptocurrencies as collateral in the mortgage process reflects the growing mainstream acceptance of digital assets in the United States.
As reported by Coinpectra, JPMorgan is planning to allow select wealth management clients to use crypto-based products, such as Bitcoin (BTC) exchange-traded funds (ETFs), as collateral for financing.
In a separate development, Circle’s USDC (USDC) stablecoin is set to become eligible collateral for futures trading starting next year, through a joint initiative by Coinbase Derivatives and Virginia-based clearinghouse Nodal Clear.
Though niche, there’s already a market for crypto-backed mortgage loans, which allow crypto holders to use Bitcoin and Ether (ETH) to finance real estate transactions.
Mauricio Di Bartolomeo, co-founder of Bitcoin lending platform Ledn, told Coinpectra that many Bitcoin holders have used their digital assets as collateral to purchase real estate, without selling any of their holdings.
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