From cold wallets to warm homes: Fannie and Freddie explore crypto-backed loans

The United States Federal Housing Finance Agency (FHFA) has directed mortgage giants Fannie Mae and Freddie Mac to explore incorporating verified cryptocurrency holdings into their mortgage risk assessments.

The directive, issued by FHFA director William J. Pulte, urges the two government-sponsored enterprises to submit board-approved plans outlining how digital assets, held on regulated US exchanges, might count toward borrower reserves. Until now, crypto holdings have been invisible to lenders unless liquidated into fiat.

The change signals a meaningful shift in how financial institutions may assess borrower stability, potentially unlocking mortgage access for crypto-native users, at least those who keep their coins on centralised exchanges. Notably, self-custodied wallets and assets held offshore remain outside the scope, frustrating proponents of decentralised finance.

The FHFA insists that the plans must include protections accounting for crypto volatility, aiming to balance innovation with sound underwriting. But the exclusion of self-custodied assets has drawn fire from decentralisation advocates, who argue it penalises users who prioritise autonomy and security.

The move follows a string of traditional finance players adopting crypto-linked collateral. JPMorgan now accepts spot Bitcoin ETFs like BlackRock’s iShares Bitcoin Trust for certain loans, while Anchorage Digital and Arch Lending continue to expand crypto-backed lending using BTC, ETH, and SOL. Meanwhile, BlackRock’s tokenised money market fund, BUIDL, is being used as collateral on platforms like Deribit and Crypto.com. Closer to home, Block Earner announcing a crypto-backed mortgage product in recent weeks.

Taken together, these developments suggest digital assets are slowly gaining legitimacy as collateral within established financial systems. If implemented, the FHFA’s directive could pave the way for crypto-backed mortgages to become a new standard in the US.

By Steven Pettigrove and Luke Misthos