Bitcoin breaking news: Fannie Mae has begun accepting Bitcoin and USDC as collateral for mortgage down payments. The partnership with Better Home & Finance enables borrowers to leverage up to 40% of Bitcoin’s value and 80% of USDC’s value. Loans are processed through Coinbase, with interest rates 0.5% to 1.5% higher than standard rates. The offering is restricted to down payments, requiring a separate loan to cover the full mortgage amount. Critics argue it primarily benefits wealthier borrowers and does not address rising delinquency among low-income homeowners.

Article by Eric, Foresight News

On the evening of March 26 Beijing time, the Wall Street Journal reported that U.S. mortgage finance giant Fannie Mae will, for the first time, accept cryptocurrency-backed mortgages, in collaboration with Coinbase and Better Home & Finance Holding Co., a mortgage lender approved by Fannie Mae.

This move is seen in the Web3 space as another endorsement by traditional financial institutions, but it has been almost drowned out by widespread online skepticism...

According to relevant reports and Better’s announcement, this loan is exclusively for the "down payment," designed to address the challenges buyers face when raising a down payment—including the need to sell assets and the associated tax complications. Currently, only Bitcoin and USDC are supported as collateral; borrowers must transfer their assets to Coinbase’s custodial address, with loan-to-value ratios of only 40% for Bitcoin and 80% for USDC. Additionally, interest rates for crypto-backed loans are 0.5% to 1.5% higher than conventional mortgage rates.

The good news is that borrowers don’t need to add more collateral due to a drop in Bitcoin’s price—collateral is only liquidated if payment is overdue by 60 days. However, it’s a bit hard to accept that USDC is accepted as collateral with only an 80% loan-to-value ratio.

This loan product is not intended for a mortgage, but rather for a down payment. In other words, it gives you the opportunity to use Bitcoin as collateral to borrow money for a down payment, and then use the purchased property as collateral to borrow the remaining balance, resulting in two separate loans.

Let’s do a simple calculation: suppose you want to purchase a property priced at $400,000 with a 20% down payment, which amounts to $80,000. If you use Bitcoin as collateral to cover this $80,000, you would need to pledge Bitcoin worth $200,000. As of the weekly average data through March 26, the most common 30-year fixed mortgage rate in the U.S. is approximately 6.38%, while the interest rate for borrowing against Bitcoin collateral could be as high as 8%.

On Reddit, many Americans are confused: If I have $200,000 worth of Bitcoin in my portfolio, how can I not come up with $80,000 for a down payment? If I can’t afford a down payment, how could I possibly have the money to buy Bitcoin?

Of course, there is also considerable support, with some netizens pointing out that high capital gains taxes mean selling $1 million worth of Bitcoin might leave you with only $650,000—but this approach allows many to use leverage to buy a home while still holding onto their Bitcoin, offering an additional option for many.

Although there are many supporters, their descriptions suggest that at least all of them are middle-class and have a fairly deep understanding of finance and taxation. This has sparked a debate about “helping the rich, not the poor.”

Axios also mentioned in its report that the product is "not a broad-based first-time homebuyer product," suggesting that it may provide additional assistance to those with certain financial means, but fails to address a more pressing practical issue:

The mortgage default rate among low-income populations has risen sharply since the end of last year.

Many ordinary citizens have also voiced concerns about this on Reddit. According to the latest report released by Cotality in February 2026, the U.S. national mortgage delinquency rate (over 30 days past due) in December 2025 remained unchanged from December 2024 at 3.2%. Federal Reserve data shows that the single-family home mortgage delinquency rate in the fourth quarter of 2025 was 1.78%.

However, data for FHA loans—U.S. government-backed loans designed to help low- and moderate-income individuals and first-time homebuyers purchase homes—tell a very different story. In the third quarter of 2025, the FHA loan default rate rose to 10.78%, an increase of 21 basis points from the previous quarter, with the serious delinquency rate rising nearly 50 basis points year-over-year. Additionally, the FHA loan delinquency rate has exceeded 11%, accounting for 52% of all seriously delinquent loans.

The criticism centers on whether Fannie Mae is attempting to mask risks that are already spreading by taking on even greater risk.

As early as mid-2025, the U.S. Federal Housing Finance Agency instructed Fannie Mae and Freddie Mac to study whether cryptocurrency assets should be considered in loan approval decisions. At the time, many scholars in the financial industry expressed opposition, with the primary concern being that relaxing standards appeared strikingly similar to the conditions preceding the 2008 subprime mortgage crisis.

In the U.S., prepaying a loan after taking it out requires paying a hefty prepayment penalty, meaning that if you want a loan, you must lock up your Bitcoin for the long term. If you only own 5 Bitcoin and must pledge them all to buy a house, with no access to them for 30 years, your willingness to do so would likely be low; but if you own 200 Bitcoin, pledging 50 or even 100 to improve your living situation seems far more reasonable—after all, you’re clearly a long-term holder and wouldn’t sell under any circumstances.

For wealthier individuals with stronger cash flow, using Bitcoin as collateral to purchase a home provides leverage to continue investing in other assets without disrupting their portfolio—or simply enables asset substitution. But what the poor don’t understand is why you’d assume I can’t afford a home because I bought Bitcoin.

Integrating Bitcoin into the complex traditional financial system is a promising but uncertain frontier. As one Reddit user quipped, when Bitcoin truly becomes “too big to fail,” will it just be the fuse that ignites the next explosion?