US Federal Housing Finance Agency Directs Fannie Mae Freddie Mac to Recognize Cryptocurrency as Asset in Mortgage Loans

The United States is taking significant steps to integrate cryptocurrency into its mainstream financial policies, marking a major shift in federal housing finance. This move aligns with President Donald Trump’s vision of positioning the US as a global leader in crypto innovation. The Federal Housing Finance Agency (FHFA) has directed mortgage finance giants Fannie Mae and Freddie Mac to develop proposals for recognizing cryptocurrency as a form of asset in mortgage loan risk assessments. In a letter issued, FHFA director William J. Pulte instructed the two government-sponsored enterprises (GSEs) to explore incorporating crypto holdings into risk assessments for single-family mortgage loans without requiring conversion of those assets into US dollars. This represents a significant change in federal housing policy, as digital assets have traditionally not been factored into traditional mortgage evaluations unless liquidated into fiat currency.

Fannie Mae and Freddie Mac, under federal conservatorship since the 2008 financial crisis, play a crucial role in the US housing finance system. Their ability to purchase mortgages from lenders has long helped maintain liquidity and stability in the housing market. Pulte explained that this move comes after extensive study and aligns with President Donald Trump’s vision of positioning the US as a global hub for crypto innovation. Importantly, Pulte’s letter specifies that only cryptocurrencies held on US-regulated centralized exchanges and subject to relevant laws should be considered. This cautious approach ensures regulatory compliance while acknowledging the growing role of crypto in the financial ecosystem.

The decision was made amid broader trends indicating increasing institutional acceptance of digital assets as legitimate collateral. For instance, JPMorgan is preparing to let some of its wealth management clients use crypto-based financial products like Bitcoin ETFs as collateral for financing. Additionally, Coinbase Derivatives and clearinghouse Nodal Clear are planning to make Circle’s USDC stablecoin eligible as collateral for futures trading beginning next year. While crypto-backed mortgages are still a niche offering, their use is expanding. Mauricio Di Bartolomeo, co-founder of Bitcoin lending platform Ledn, noted that many crypto investors have successfully leveraged Bitcoin and Ethereum to purchase property without having to sell their holdings.

While the US is opening up to crypto, the UK is taking a different approach. Barclays, one of the leading banks in the UK, will begin blocking cryptocurrency transactions made through its Barclaycard credit cards. This move is driven by concerns over the extreme volatility of cryptocurrencies and the lack of regulatory protections for consumers. Barclays stated that falling crypto prices could leave customers in unmanageable debt, especially given that crypto assets are not covered by the Financial Ombudsman Service or the Financial Services Compensation Scheme if something goes wrong. The bank allowed crypto purchases via its credit cards since at least 2018, giving customers access to crypto markets through major exchanges. Their latest announcement is a significant reversal in policy from a bank that services over five million credit card accounts in the UK.

The ban comes during a time of broader debate in the UK over whether additional restrictions should be imposed on using credit to purchase cryptocurrencies. The Payments Association, a group representing the payments industry, responded critically to the suggestion by arguing that it unfairly likens crypto investments to gambling. They pointed out that consumers should have the autonomy to make informed financial decisions within existing credit limits. However, buying digital assets with a credit card can come at a steep cost, as many credit card issuers categorize these transactions as cash advances, which often result in higher fees and interest rates.

Part of the reason why the US is warming up to crypto could be its recent regulatory progress. Senator Cynthia Lummis said she expects Congress to pass two major crypto bills related to stablecoins and digital asset market structure by the end of 2025. At the Bitcoin Policy Summit, Lummis shared some details about the ongoing progress of the Digital Asset Market Clarity (CLARITY) Act in the House of Representatives and the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act in the Senate. While she hopes the legislation will pass before the end of this calendar year, she stated she would be “extremely disappointed” if they were not passed by 2026. Lummis chairs the Senate Banking Committee’s digital asset subcommittee, and acknowledged the political difficulty of securing bipartisan support for crypto bills. She believes it is very important to ensure both sides of the aisle feel involved in the process to avoid partisan resistance.

While some Democrats have supported crypto-related legislation, including the GENIUS Act — which passed the Senate with 68 votes, 18 from Democrats — others are still a bit hesitant. Their concerns center around President Donald Trump’s growing involvement in the crypto sector, including his issuance of meme coins, his ties to the crypto firm World Liberty Financial, and political donations from digital asset industry executives. The path to passage in the House is still uncertain. Lummis’s timeline contrasts with that of the executive director of the President’s Council of Advisers on Digital Assets, who predicted in May that the GENIUS Act could be ready before the congressional recess in August. President Donald Trump is also ready to sign the bill without amendments if it passes swiftly through the House. However, with Republicans holding only a slim majority, both the CLARITY and GENIUS Acts will need at least some Democratic support to move forward.