US Mortgage Regulator Considers Bitcoin to Ease Housing Crisis

The United States federal housing regulator has taken a landmark step toward recognizing cryptocurrency as a legitimate financial asset in the context of home lending.

Federal Housing Finance Agency director Bill Pulte posted on X, June 23, 2025, saying his team will formally look into how owning crypto might affect mortgage eligibility. 

A Housing Market in Crisis: The Backdrop You Need to Understand

What makes Pulte’s announcement significant becomes clear only when seeing how dire the U.S. housing scene really is. Mortgage originations - where banks approve and release loans to buy homes - dropped sharply around mid-2024, barely inching up again by early 2025. Far from a small blip on a chart, this points to deep cracks forming in Americans home ownership.

A shortage is building because multiple forces overlap. Homes aren’t being built fast enough to match how many people need them. For years now, higher prices for materials, fewer workers, yet complex rules have slowed builders down. Meanwhile, big companies buying homes keep taking large chunks of what's for sale, pushing costs up and making it harder for new buyers to enter. At the same time, older homeowners who could open space by moving into care facilities often stay put instead. Less turnover means even less room on the market.

High borrowing expenses made things much worse. Because inflation stayed high after the pandemic, interest rates were kept steep by the central bank - which sent home loan prices soaring beyond what lots of average earners can handle. Pulte hasn’t held back in blaming Jerome Powell, head of the Fed, for the strategy, demanding he step down just before Powell's congressional testimony on June 26, 2025.

Even with all the chaos, home ownership numbers in the US haven’t changed much in fifty years - still near 62%. Yet behind those steady totals are fewer newcomers stepping into buying homes, which could easily hollow out that number over time.

FHFA: What It Is And Why Its Crypto Recognition Counts?

The Federal Housing Finance Agency is the regulatory body that oversees Fannie Mae and Freddie Mac - the two government-sponsored enterprises known as GSEs that together underpin most home loans across the U.S.. Fannie and Freddie don't originate loans themselves - lenders do that part. Once issued, those debts get bought by Fannie or Freddie, who then bundle them into what are called mortgage-backed securities. Investors buy those bundles later, feeding money through the system. Because of this loop, lenders find cash returning to them, ready to issue more loans.

With Fannie Mae and Freddie Mac shaping how most traditional lenders operate, a change in FHFA policy will steer an entire system where just last year saw trillions flow through home loans. Should crypto get formal approval at this level, it wouldn’t stay on the sidelines much longer when it comes to tapping into national lending networks.

For years, one of the biggest structural barriers to crypto-backed mortgage lending wasn't consumer appetite but rather accounting rules. What stood in the way? A guideline called Staff Accounting Bulletin No. 121 (SAB 121), put out by the SEC. That rule forced banks to treat digital assets held for clients as liability (debts they owed). Suddenly, offering loans using crypto as security became too heavy a burden, since holding crypto on behalf of customers ballooned their reported liabilities. Higher debt on paper meant tighter limits on what these lenders could do financially.

On January 23, 2025, SAB 121 got scrapped - shortly after Donald Trump took office - in what became a signal shift in how Washington treats cryptocurrency rules. That move shook things up for the sector, lifting an accounting rule that once blocked big banks from jumping into crypto-backed loans. Yet despite the change, home loans using digital assets aren’t suddenly allowed everywhere. Programs run by the FHA, VA, and USDA continue banning crypto as security for mortgages. Even cashing out crypto to cover part of a house payment can hit snags, often demanding piles of paperwork just to qualify.

Bitcoin Emerging as Ideal Collateral

Right now, the spotlight isn’t on every cryptocurrency at once. BTC stands out, and not just because it's bigger in value than others.

Bitcoin’s clear record of ownership stands out when used as loan security, says Mitchell Askew from Blockware. Settlement happens on an open ledger, visible to anyone checking it. What you see is what's there, making double-pledging hard to hide. Other assets like property or stocks lack this instant verification layer. 

CJ Konstantinos - People's Reserve founder, which works with Bitcoin-supported loans and debt notes - claimed something bolder, that digital currency might reduce dangers tied to mortgage investments managed by giants like Fannie Mae and Freddie Mac. Because Bitcoin operates openly, moves easily across borders, and trades constantly, it could add steadiness to portfolios long haunted by hidden weaknesses. Back then, during the 2008 crash, those blind spots caused massive damage. 

Homebuyers hoping to use Bitcoin profits for a house deposit must track everything carefully. From the moment they sell, every step counts - where the money came from, how it moved, who handled it. Banks already stick to strict rules meant to stop dirty money flowing through loans. Digital trails left by Bitcoin transactions on the blockchain often hold up better than piles of untraceable cash from traditional sales.

Not everyone's convinced about Bitcoin mortgages. Real issues fuel that doubt. Price swings top the list of worries.

Strike, a company offering Bitcoin-backed loans in select cases, admits its system carries danger: should Bitcoin’s price fall fast, the link between loan size and collateral worth (LTV) might cross acceptable threshold. That shift could push lenders to demand more security or partial repayment through margin notices. Failing to meet those demands risks immediate selling of the pledged assets. A sharp fall in Bitcoin could leave someone owing more than the home is worth. This mix of falling asset values and mounting debt spells trouble few planned for. 

This is why calling it a "study" makes sense - maybe even necessary. Because without testing under pressure, rules on loan limits, plus how to handle shifting prices, there’s no safe way forward.

Who Is Already Using Crypto to Buy Homes?

Not waiting for Washington, some private lenders quietly step into the gap - focusing on those with bigger paychecks or investment goals. 

Instant loan approval comes your way if you show enough cryptocurrency to back the entire amount, that's the rule borrowers using Milo - once called MiloCredit - follow. Most are buying a second home, sometimes a holiday place, maybe even an asset meant to grow over time. These people usually earn well, yet traditional lenders hesitate because their money sits in digital form. 

Strike offers a similar product with a heavier emphasis on Bitcoin specifically, letting longtime holders tap into cash value while keeping their coins untouched - which sidesteps tax events that usually follow selling. 

The pattern revealed that the demand for crypto-collateralized mortgages already exists at the premium end of the market. That trend caught notice. Now regulators might open doors wider, reaching beyond the wealthy few. Downward it stretches, to the roughly 55 million Americans - about 20% of the adult population - who now own some form of cryptocurrency, according to the National Cryptocurrency Association's 2025 State of Crypto report.