Your stock portfolio still holds no interest for Fannie Mae, the government-sponsored enterprise whose rules may determine whether a lender will front you the money for a house. It will, however, take a peek into your crypto wallet if you want.

In March, Fannie said it would begin accepting crypto-backed mortgages through a new product offered by Coinbase and Better Home and Finance. The move marks a major shift: While Fannie supports about 40% of the US housing market by buying mortgages from lenders and repackaging them into securities sold to investors, it has been steadfastly skeptical of loans backed by anything other than cash down payments. 

That has long been a point of frustration for prospective buyers, particularly those who are asset-rich and cash-poor. Introducing crypto-backed mortgages could spark a renaissance in housing-market democratization, unlocking the dream of ownership for the masses, supporters say. Skeptics, on the other hand, worry that the volatile asset might become the heart of a new mortgage crisis like the one that eventually paralyzed markets in the late 2000s, wiping out trillions of value and forcing massive government bailouts.

Which will it be? Most likely neither, at least for now, experts told The Daily Upside, though a couple of kinks in the financial piping are possible.

The structure of the crypto-backed mortgage through the Coinbase partnership with Better Home and Finance is simple enough. Borrowers will essentially take out two loans, the first being a typical mortgage with Better Home. The second loan, to cover the down payment (typically 3% to 5% of the home price), will use either bitcoin or USDC (the dollar-backed stablecoin issued by Circle) held in Coinbase accounts as collateral. Better Home will hold both loans, and the crypto holdings in the second will be locked in once pledged, then returned to the borrower once the loan is paid off.

The perks for borrowers are rather obvious: “Before this product existed, [crypto holders] faced a stark choice: Sell the position, pay capital gains taxes and forfeit future appreciation, or stay out of the housing market,” Janine Yorio, CEO of digital asset infrastructure platform Interstice Digital, told The Daily Upside. A RedFin survey published last summer found that nearly 13% of millennial and Gen Z homebuyers sold crypto investments to fund a down payment.

Borrowers still face some downsides. They’ll be paying the interest on two loans, instead of just one, though Better Home CEO Vishal Garg recently told CNBC that it will offer lower rates than most competitors.

Of course, borrowing against assets isn’t novel, and some fintech players such as Figure and Milo have been offering crypto-backed mortgages for years. “What changed on March 26, 2026, was which loans the government would stand behind,” Yorio said. 

The majority of US mortgages flow through GSEs like Fannie and its counterpart Freddie Mac, and Fannie’s decision follows a mid-2025 order from the Federal Housing Finance Agency, which has served as conservator for both government-controlled organizations since the financial crisis, to consider ways to enable use of cryptocurrency assets in home loan assessments. 

That’s in keeping with the broader pro-crypto positions taken by the Trump administration after the president promised to support the industry during his 2024 campaign.

In essence, rank-and-file crypto owners now have Fannie Mae’s blessing to role-play as billionaire Elon Musk, borrowing heavily against their assets. 

On the other side of the ledger, naturally, is the GSE’s blessing for lenders to sell crypto-backed mortgages into the secondary market just like any other mortgage. That boosts their appeal and, yes, creates crypto-backed mortgage-backed securities.

The recent headlines have naturally raised more than a few eyebrows.

“You’re essentially stacking two volatile assets on top of each other,” Michael Branson, CEO at All Reverse Mortgage, told The Daily Upside. “Crypto moves 24 hours a day, and housing markets can turn fast.”

To put it simply, crypto-backed mortgages introduce the potential for margin-call dynamics: Bitcoin lost about half its value, tumbling from a high over $120,000 to a low near $60,000 during a crypto winter from October through February, before beginning to rebound.

“If collateral values fall while home prices soften, lenders could face pressure to issue margin calls or demand additional collateral at the exact moment borrowers are under stress,” Yorio said. “That’s where these products start looking less like traditional mortgages and more like leveraged finance products tied to housing.”

Borrowers have some protection in the Coinbase and Better Home product. Their loan payments don’t change even if the value of the underlying cryptocurrency falls. 

They pay heavily for the privilege up front, however, with the loans requiring 250% collateral when backed by bitcoin and 125% when backed by USDC. Additionally, delinquency is triggered after just 60 days, or half the time that a lender generally allows before beginning foreclosure on traditional mortgages.

So who is most at risk? 

“The lender,” Bill Dallas, a 40-year mortgage and banking industry veteran and CEO of business advisory firm Dallas Capital, told The Daily Upside. “If I’m a lender, and I’ve sold the loan to Fannie Mae, I have a contractual relationship with Fannie Mae. They’re going to jam [a delinquent loan] back to me. So it’s my problem.”

The mainstream embrace of a mortgage backed by an asset that can wildly shift in value over the course of a single day has thus created an entirely new borrower psychology and a very different risk management environment for lenders.

Fintech player Milo has been offering crypto-backed mortgages outside of the GSE ecosystem since 2022, and CEO Josip Rupena told The Daily Upside it has avoided margin calls thanks to a structure that allows for drawdowns of around 65% in the underlying value of the bitcoin collateral before borrowers are required to post more. Milo currently has more than 100 customers.

“Most of these models depend on the assumption that large-cap crypto assets mature over time and become less volatile than they’ve historically been,” Yorio said, adding that lenders are valuing bitcoin conservatively to buffer against volatility while USDC receives more favorable treatment.

Introducing such volatility is practically anathema to the institutionally inert market. But it also begs the question: What about all the other assets that borrowers could use as collateral, such as stocks, bonds or other real estate holdings? 

The same RedFin survey found that more than 20% of millennial and Gen Z homebuyers sold stock investments to help fund their down payments, surpassing the number who sold crypto, while roughly 12% pulled money from retirement funds early.

“[Crypto-backed mortgages are] a good move, but [GSEs] should’ve done it first with stock portfolios,” Dallas said. “This, I think, is being pushed by Better or Sofi or Figure, companies that are in this space that have a bunch of clients that actually have these assets, and so they’re asking for, you know, could we do this?”

The good news for anyone already getting goosebumps from the words “mortgage-backed securities” and “margin calls” is that crypto-backed mortgages are a niche market now, and likely to remain so for the foreseeable future.

A Gallup poll published last year found just 14% of US adults hold cryptocurrency (though other estimates peg the figure as high as 30%) and determined an outsized proportion of crypto holders are “upper income.” Comparatively, 62% of Americans own stocks, Gallup found.

In a telling stat, another study found that 68% of American millionaires are invested in cryptocurrency, which could be an indicator of who will employ the crypto-backed mortgage.

“Right now, it feels more like a bridge product for people who already hold meaningful crypto positions,” Yorio said.

So while a simultaneous crypto and real estate market downturn could create a real-time stress test, the players involved aren’t exactly the types who were securing NINJA (no income, no job, no assets) loans in 2008.