A couple in Ann Arbor, Michigan closed a Fannie Mae-backed mortgage in early June without selling a single satoshi. Their down payment came from a second loan. The bitcoin securing that loan was worth two and a half times what it paid out.

That ratio is the product. Better Home & Finance and Coinbase announced token-backed conforming mortgages on March 26, 2026, and the headline — keep your bitcoin, buy the house — is accurate. The price of keeping it sits in numbers that most of the coverage skipped.

What Fannie Mae's Rulebook Still Says

Fannie Mae has a section on crypto in its Selling Guide: B3-4.1-04, Virtual Currency, last updated May 4, 2022. It has not been rewritten since. Crypto counts toward a down payment, closing costs or reserves only after it has been sold. The lender needs "documented evidence that the virtual currency has been exchanged into U.S. dollars and is held in a U.S. or state regulated financial institution," verified before the loan closes. Bitcoin cannot serve as the earnest money on the sales contract either.

Federal Housing Finance Agency Director Bill Pulte ordered Fannie Mae and Freddie Mac on June 25, 2025 to prepare proposals for counting crypto held on U.S.-regulated exchanges as mortgage reserves, with no conversion to dollars required. Fourteen months later, the guide still says dollars. No published Selling Guide change has followed the order.

Two Loans, One Payment

Better's structure works around that rather than through it. A borrower gets two loans at once. The first lien is an ordinary conforming mortgage that Fannie Mae buys, and nothing about it touches crypto. The down payment dollars come from a second, privately financed loan that Better funds itself, secured by the pledged tokens and by a second lien on the house. The two loans share a term and get billed as one monthly payment.

The tokens move from the borrower's Coinbase account into Better's custodial account on the Coinbase platform and stay there for the life of the down payment loan. Ownership does not change hands. The agency requirement is met in the most literal way available: Fannie Mae buys a loan where the buyer brought cash to the table, and the question of where that cash came from lands on somebody else's balance sheet.

The Collateral Math

Better credits 40% of a bitcoin pledge toward the down payment loan, which is a 250% collateralization ratio stated the other way round. Put up $250,000 of BTC, get $100,000 toward the house. USDC, which does not swing, is pledged at 125% — $125,000 of stablecoin for the same $100,000 — and Better says USDC pledges earn rewards that offset mortgage payments. Bitcoin and USDC are the only two assets accepted at launch. Ether and Solana are listed as possible additions later.

📊 Crypto Committed per $100,000 of Down Payment

Source: Better Mortgage product terms, March 2026. The sale route also triggers capital gains tax on any appreciation; the pledge routes do not.

The pledged coins come back after the mortgage is repaid in full or refinanced, or out of the proceeds when the house sells. Any appreciation over those years stays with the borrower. So does any drawdown.

🔍 Sell vs. Pledge on a $100,000 Down Payment

Sell: liquidate roughly $100,000 of BTC. If half of that is gain and long-term rates apply at 15%, about $7,500 goes to federal capital gains tax, before state tax. One loan, standard rate, position closed.

Pledge: lock $250,000 of BTC. No sale, so generally no capital gain is realized at the pledge. Two loans, a higher blended rate, and a quarter of a million dollars of collateral frozen until the mortgage is gone.

The break-even question: does the bitcoin you kept beat the extra interest you paid to keep it? Nobody can answer that in advance, which is the honest part of the sales pitch.

No Margin Calls Is the Real Feature

Every crypto-backed loan before this one had the same failure mode. Bitcoin drops 40% over a weekend, the loan-to-value breaks a threshold, and the borrower gets a top-up demand or a forced sale at the bottom. That mechanic is why crypto lending blew up twice, and it is exactly the wrong feature to attach to a house.

Better and Coinbase removed it. Day-to-day bitcoin price movement has no effect on the mortgage terms or the down payment loan. There is no top-up requirement and no price-triggered liquidation. Collateral gets liquidated on one condition: the borrower goes 60 days delinquent on payments, the same trigger that applies to any conforming loan. Better priced that protection into the 250% ratio, which is what a lender charges when it agrees never to call you.

What It Costs

Rates on the crypto-backed loans run between half a percentage point and 1.5 percentage points above a standard 30-year, by the figures in the congressional correspondence, with the exact premium depending on borrower profile. Coinbase One members get a 1% rebate on the loan amount toward closing costs, capped at $10,000. Better says the product is available in all 50 states and the United Kingdom, on any Fannie Mae-eligible property type.

Seven Senators Want It Rescinded

On April 30, 2026, seven senators — Elizabeth Warren, Dick Durbin, Jeff Merkley, Chris Van Hollen, Richard Blumenthal, Bernie Sanders and Mazie Hirono — wrote to Pulte asking FHFA to withdraw approval. Their objection is structural rather than ideological: the 250% requirement "forces a homebuyer to pay interest on two loans," and a borrower carrying two liens and a rate up to 1.5 points above market has more reason to walk away if home prices soften, with taxpayers behind the guarantee. They set a May 30 deadline for answers. FHFA has published no response.

Better's founder and chief executive Vishal Garg is selling the other side of it. "This is a bank eligible asset. We have Banks lined up to buy these," he has said of the down payment loans, with plans to extend the collateral list to more token assets. Better funded $1.64 billion of mortgages in the first quarter of 2026, up 89% from a year earlier.

Who This Actually Fits

Better's waitlist reached roughly $250 million of potential loans, and 41% of the people on it did not have enough cash for a down payment otherwise. That figure deserves more attention than the collateral ratio. The demand is coming from buyers who are short on cash and long on tokens, which is a different customer than the holder optimizing around a capital gains bill.

Those are different risk profiles. A holder with $250,000 of BTC and $100,000 in savings is choosing between two fine options. A buyer with $250,000 of BTC and nothing in the bank is putting the entire position behind a house with no reserve left over. Anyone in the second group should look hard at whether an emergency fund survives the pledge, because 60 days of missed payments is the one line that empties the collateral account.

Before applying, four things worth pinning down:

  • Get the blended rate in writing. One payment covers two loans. Ask for the effective all-in rate against a standard conforming quote from the same lender on the same day.
  • Check the release language. The collateral returns on full repayment, refinance, or sale of the home. Read what counts as a qualifying refinance before you sign.
  • Confirm the tax treatment with a professional. Pledging collateral is generally not a disposal for U.S. federal tax, which is the entire appeal, and the analysis belongs to someone who knows your basis.
  • Price the alternative honestly. Selling costs you the tax once. Pledging costs you interest every month for as long as the loan runs.

The Ratio Is the Message

My read is that the no-margin-call design matters more than the Fannie Mae stamp everyone wrote about in March. Removing forced liquidation from a crypto-collateralized loan is a real piece of product engineering, and it is the reason this structure belongs anywhere near a primary residence. The 250% ratio is the invoice for that promise, and the invoice is fair.

What is unresolved is the regulatory half. Fannie Mae's own guide has said since 2022 that crypto becomes dollars before it becomes a down payment, and it still says that today, more than a year after the FHFA order meant to change it. The lending is running ahead of the rulebook. Anyone weighing a pledge should read the virtual currency section and Better's launch announcement side by side, then decide which document describes the loan being offered.