Points of Focus

• An Ann Arbor couple became the first to secure a Fannie Mae-backed mortgage using Bitcoin as collateral, avoiding a taxable BTC sale.
• The mortgage combines a standard home loan with a second loan backed by Bitcoin or USDC held on Coinbase.
• Only Bitcoin and USDC held on Coinbase qualify; self-custodied and DeFi assets are excluded.

Better Home and Finance and Coinbase closed the first Fannie Mae-backed crypto mortgage in June 2026 in Ann Arbor, Michigan. The borrowers, Joe, a software engineer, and Amy, a graduate student, used their Bitcoin holdings as collateral to purchase their first home while avoiding a taxable liquidation of their crypto position.

Joe explained the problem the product solved directly. His prior options were selling Bitcoin (BTC) and paying long-term capital gains tax, or using a margin loan at a variable interest rate with margin call risk attached. The Better and Coinbase structure removed both constraints simultaneously.

🚨THE FIRST FANNIE MAE BACKED BITCOIN MORTGAGE HAS CLOSED IN THE UNITED STATES

A couple in Michigan bought their first home by pledging Bitcoin as collateral instead of selling it, making it the first Fannie Mae backed mortgage using crypto in US history.

Borrowers can pledge… pic.twitter.com/0cUPinpIAl

— Coin Bureau (@coinbureau) June 28, 2026

How the product actually works

A borrower must hold a Coinbase account and take out two loans simultaneously. The first is a standard conforming mortgage with Better. The second is a crypto-backed loan, collateralized by Bitcoin or USDC held in Coinbase custody, with proceeds funding the down payment on the first loan. Fannie Mae purchases the primary mortgage like any other conforming loan.

The regulatory foundation was laid on June 25, 2025, when FHFA Director William Pulte issued a directive to Fannie Mae and Freddie Mac to prepare a proposal for consideration of cryptocurrency as a reserve asset in single-family mortgage risk assessments without requiring conversion to dollars. The directive reversed Fannie Mae’s longstanding guideline that had blocked digital assets from underwriting since 2022.

The FHFA carve-out is structurally significant. Only cryptocurrency held on a US-regulated centralized exchange qualifies. 

Self-custodied Bitcoin, staked assets, and DeFi-locked positions are excluded entirely. Coinbase’s regulated custodial infrastructure is therefore not simply a convenient partner choice. It is a structural requirement of the product’s Fannie Mae eligibility.

The problem Better is solving

Better CEO Vishal Garg said the traditional 30-year mortgage was designed for a generation that kept savings in bank accounts, whereas many homebuyers today build wealth through digital assets. The product targets borrowers who meet income and credit requirements but cannot demonstrate sufficient cash reserves for a conventional down payment.

“We have now finally created the infrastructure rails to enable any tokenized asset in America to be pledged to help someone afford to buy a home,” Garg told CNBC in March 2026. 

Nationwide rollout this summer; risks remain

Better confirmed plans to make the product available to eligible borrowers nationwide by summer 2026, with additional digital assets potentially added subject to market and regulatory developments. Better has funded more than $110 billion in loan volume and operates across all 50 US states and the United Kingdom.

Bitcoin’s price volatility is the structural risk the product does not fully eliminate. A sharp drawdown in Bitcoin’s value after closing could impair the collateral backing the second loan, creating pressure on borrowers who have simultaneously taken on mortgage debt. 

At current prices near $60,159, a 52% drawdown, well within Bitcoin’s historical range, would materially change the collateral picture. The margin call risk Joe wanted to avoid hasn’t disappeared. It has simply been pushed further down the capital structure.