Nearly four months after crypto exchange Coinbase and the Federal National Mortgage Association—better known as Fannie Mae—announced their partnership, the companies have now revealed what they call the first-ever mortgage backed by crypto collateral.
No Need To Sell Crypto
The idea was first introduced in March, when Better Home & Finance and Coinbase announced a joint mortgage product aimed at homebuyers who own crypto but struggle to meet the cash requirements of traditional financing. Instead of forcing customers to sell their digital assets to come up with a down payment, the Coinbase program lets borrowers pledge crypto—like Bitcoin (BTC) or Circle’s USDC stablecoin held in a Coinbase account—to secure a separate loan that covers the down payment.
Importantly, the actual home mortgage is still a conventional Fannie Mae–backed loan. This means the structure works within the existing conforming mortgage system, rather than replacing it with a completely new, crypto-based mortgage model.
Related Reading: XRP Price Falls To 4-Month Lows—Charts Signal Sell, On-Chain Data Turns Bearish
In Thursday’s update, Better Home & Finance and Coinbase said the first loan has already been finalized. The borrowers are Joe and Amy, a married couple in their early 30s from Ann Arbor, Michigan. Coinbase reported that both had significant savings in digital assets, but faced a common hurdle for many qualified buyers: they didn’t have enough cash on hand for a traditional down payment.
According to the companies, instead of selling their long-term Bitcoin holdings—which could trigger capital gains taxes and force investors to lose their exposure—they used the program to pledge their crypto as collateral. They then completed the purchase of their first home.
Coinbase Sees New Path To Homeownership
Joe, a software engineer, explained that owning a home has been a goal for a while, but he wasn’t willing to give up his long-term investment plan just to qualify for a down payment. He said the mortgage helped him avoid selling his Bitcoin, avoid trying to time the market, and avoid having to reset his finances in a way that would delay his path to buying a home.
Joe said: “We closed on our home, and my Bitcoin stayed intact. We didn’t have to sell, didn’t have to time the market, and didn’t have to start over financially to reach our homeownership goals. That meant everything.”
Related Reading: Bitcoin Drops Below $66,000 Amid Mounting ETF Outflows, $4B Withdrawn In 12 Days
Coinbase framed this milestone as part of a broader message about the usefulness of crypto for holders. Mark Troianovski, Head of Consumer & Platform Partnerships at Coinbase, said the company believes Bitcoin should do more than just sit unused in a wallet. He described the first token-backed conforming mortgage as a concrete example of that idea and pointed to the scale of digital-asset ownership in the U.S.
Troianovski further stated: “Funding the first token-backed conforming mortgage is one of the most tangible demonstrations of that vision we’ve seen. Tens of millions of Americans have built real wealth in digital assets. That wealth now has a direct path to homeownership, creating new opportunities for the next generation of homebuyers.”
Featured image created with OpenArt; chart from TradingView.com
Frequently Asked Questions
Here is a list of FAQs about Coinbases Bitcoinbacked mortgage now covered by Fannie Mae
Basic Questions
1 What is a Bitcoinbacked mortgage
Its a home loan where you put up your Bitcoin as collateral instead of selling it You get cash to buy a house but you still own your Bitcoin
2 How is this different from a regular mortgage
Normally you need a big cash down payment and good credit With this loan your Bitcoin acts as the down payment You dont have to sell your crypto to get the cash
3 Why does Fannie Mae matter here
Fannie Mae is a huge governmentbacked company that buys mortgages from banks Their approval means this type of loan is now considered safe and standard not a risky experiment It makes the loan more reliable and cheaper for borrowers
4 Do I lose my Bitcoin if I get this mortgage
No You still own it but its held in a special account as collateral You only lose it if the value of Bitcoin drops a lot and you dont add more collateral
Benefits Risks
5 Whats the biggest advantage of this loan
You avoid the tax event of selling your Bitcoin If you sold Bitcoin to buy a house youd pay capital gains tax Here you borrow against it so you dont trigger taxes
6 What happens if Bitcoins price crashes
The bank will ask you to add more Bitcoin or cash If you cant they might sell some of your Bitcoin to keep the loan safe You could lose part of your crypto
7 Is the interest rate higher than a normal mortgage
Probably yes at first Because crypto is volatile the lender takes more risk But Fannie Maes backing should help keep rates lower than they would be without it
Practical Tips Examples
8 Can I use any amount of Bitcoin
There is likely a minimum and a maximum loantovalue ratio You cant borrow the full value of your Bitcoin
9 Example I have 200k in Bitcoin Can I buy a 500k house
Not directly Youd use your Bitcoin