Ethereum News Today: Fannie Mae and Freddie Mac Approved for IPOs in Major Privatization Move

The U.S. government has approved the initial public offering (IPO) plans for Fannie Mae and Freddie Mac, marking a significant step toward the privatization of the two government-sponsored enterprises (GSEs). The move, reported by the Wall Street Journal on August 8, 2025, aims to reintegrate these entities into the broader financial market while reducing federal support and enhancing their operational independence [1].

Regulatory oversight for the IPOs will be managed by the Federal Housing Finance Agency (FHFA), which has been the conservator of Fannie Mae and Freddie Mac since the 2008 financial crisis. The U.S. Department of the Treasury also plays a pivotal role, holding $340 billion in senior preferred shares of the GSEs. These shares, which represent the government’s financial stake, may be converted or adjusted with the support of Congress to facilitate the transition [1].

The proposed IPOs come amid significant capital shortfalls—Fannie Mae reports a $33 billion deficit, and Freddie Mac faces a $162 billion gap. The Treasury’s response, including potential modifications to its preferred share structure, will be critical in determining the financial stability and success of the transition. Mark Calabria, former FHFA director, noted that the path to privatization is complex but necessary for the long-term viability of the GSEs [1].

The move is expected to have a broad impact on financial market dynamics, including liquidity flows and perceptions of macroeconomic stability. Analysts suggest that the reentry of Fannie Mae and Freddie Mac into capital markets could indirectly influence cryptocurrency markets. While there is no direct connection, shifts in liquidity and risk perception may affect investor behavior across asset classes, including digital assets like Bitcoin and Ethereum [1].

Ethereum (ETH) currently trades at $3,957.01 with a market capitalization of $477.65 billion, showing a 3.21% increase over the past 24 hours and a 55.88% rise over 60 days. The trading volume for the day stands at $42.91 billion, reflecting a positive market trend [2].

Coincu research highlights the potential for broader financial policy changes to influence liquidity and macroeconomic risk assessments, which could further shape market sentiments across traditional and digital asset classes [2].

Sources:

[1] Wall Street Journal

[2] Coincu Research, CoinMarketCap Community Article (https://coinmarketcap.com/community/articles/68961b6c1214ff464aa19040/)