FHFA Orders Fannie Mae Freddie Mac to Recognize Crypto Reserves for Mortgage Risk

On June 25, the US Federal Housing Finance Agency (FHFA) Director Willian J. Pulte issued a directive ordering Fannie Mae and Freddie Mac to treat cryptocurrency reserves as eligible assets when assessing risk on single-family mortgage loans. This directive is effective immediately and requires the two government-sponsored enterprises to draft plans that recognize borrower crypto holdings without converting the coins to dollars.

The directive specifies strict collateral rules and board oversight. It instructs each enterprise to limit recognition to cryptocurrency held in wallets controlled by US-regulated centralized exchanges. The order also mandates the addition of risk mitigants that account for market volatility and the maintenance of reserve ratios that reflect the share of collateral held in digital assets. Each enterprise must secure board approval before submitting the completed proposal to the FHFA conservator for review.

Fannie Mae and Freddie Mac are responsible for purchasing and securitizing the majority of conforming US residential mortgages. Their risk models determine the amount of capital they must hold against potential credit losses. By allowing crypto reserves to enter these models, Pulte aims to widen the asset information available for underwriting and facilitate sustainable homeownership for credit-worthy borrowers.

The directive instructs each enterprise to develop an assessment that integrates crypto reserves into its existing loan risk framework. This assessment must describe how the enterprise will value cryptocurrency, apply haircuts, and adjust for daily price swings. It also requires an analysis of how crypto reserves interact with other borrower assets and liabilities. After board approval, each enterprise must send the proposal to the FHFA for sign-off before implementation.

By invoking the authority to issue binding instructions that alter underwriting or capital standards, Pulte accelerated a process that would have otherwise required rulemaking or legislative action. The order does not change conforming loan limits or documentation requirements but expands the categories of qualifying reserves.

Pulte announced the action on his social media account, stating that he acted “in keeping with the President’s vision to make the US the crypto capital of the world.” He described the day as a historic one for the cryptocurrency industry. The directive follows months of internal study and does not specify which coins qualify, but the reference to US-regulated exchanges limits the pool to tokens listed on venues that follow federal know-your-customer and anti-money laundering rules.

Both enterprises must begin work on the proposals “as soon as reasonably practical.” Pulte committed the agency to review each plan once the boards submit them but did not set a public deadline for submission. The order remains in force unless the FHFA rescinds or modifies it.