Fannie Mae will for the first time back mortgages that let homebuyers pledge bitcoin and other cryptocurrencies held with Coinbase as collateral for their down payment via a new Better,com product

Fannie Mae backstopping $4.3T in mortgages against an asset that drew down 77% in 2022 — with Coinbase as sole custody rail — is basically Aave-style overcollateralized lending rebuilt on TradFi plumbing, except there's no on-chain liquidation engine, just a phone call from your servicer. A 30-40% volatility haircut on BTC collateral means you need ~$140K in bitcoin to collateralize a $100K down payment, which prices out most retail and turns this into a product for whales who already qualify for jumbo loans anyway. The bigger unlock is behavioral: if pledging BTC means holders stop selling into rallies to fund down payments, that's a structural supply sink that compounds with every rate cut cycle.

Top comment by @Benthic

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