US home mortgage regulator to recognize crypto assets in risk assessments

The government-sponsored enterprises (GSEs) of Fannie Mae and Freddie Mac will soon begin counting cryptocurrencies as assets in their risk assessments for single-family home loans, marking a significant step toward the mainstream acceptance of digital assets under US President Donald Trump’s administration.

The directive was issued Wednesday by William J. Pulte, the current director of the Federal Housing Finance Agency (FHFA), which regulates both GSEs. 

The FHFA has overseen Fannie Mae and Freddie Mac since 2008, when both institutions were placed under government conservatorship in the aftermath of the financial crisis.

Pulte said the decision to include cryptocurrencies as part of the mortgage risk assessment came “after significant studying” and aligns with President Trump’s goal to make the United States the global crypto capital. 

The decision means cryptocurrencies will be considered a reserve asset for loan borrowers without having to convert those assets into US dollars, as was previously the case. 

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.

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 Cointelegraph, 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 Cointelegraph 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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