Coinbase and Better Mortgage have made a Bitcoin-backed mortgage product generally available to qualified US homebuyers, allowing them to secure a down payment loan without selling their BTC.
Summary
- Borrowers must pledge Bitcoin worth at least 250% of the loan down payment.
- Better combines a Fannie Mae-backed mortgage with a separate Bitcoin-secured loan.
- Bitcoin price declines alone will not trigger margin calls or alter the loan terms.
- Better may liquidate the collateral when a borrower falls 60 days behind on payments.
Bitcoin-backed home loans use a two-loan structure
Better Mortgage and Coinbase announced the rollout on Aug. 26, opening the product after testing it with a limited group of borrowers. Better originates and services the loans, while Coinbase provides the infrastructure used to transfer and hold the Bitcoin collateral.
Rather than creating one mortgage secured partly by a home and partly by cryptocurrency, the companies have divided the financing into two loans. One is a standard first-lien mortgage designed to meet Fannie Mae’s conforming guidelines. A separate loan, secured by the borrower’s Bitcoin, supplies the cash needed for the down payment.
Both loans carry the same interest rate and amortization period, according to the Coinbase Help Center. Borrowers make one combined monthly payment instead of servicing the mortgage and down payment loan separately.
To qualify, applicants must pledge BTC worth at least 250% of the loan down payment. Someone seeking $100,000 for a down payment would therefore need to provide Bitcoin valued at no less than $250,000 when the collateral is posted.
Following approval by Better, the borrower authorizes the transfer of the required Bitcoin from a verified Coinbase account to Better’s custodial account on Coinbase Prime. Better controls the collateral during the life of the financing, and the borrower cannot trade or withdraw the pledged coins.
The company returns the full amount of pledged BTC after the mortgage is repaid or refinanced, subject to the final loan terms. Repaying the down payment loan separately does not appear to release the collateral early because Coinbase says Better holds it until the entire mortgage is paid off or refinanced.
Bitcoin price declines do not cause margin calls
Unlike many crypto-backed loans, the Better product does not require borrowers to add collateral merely because Bitcoin loses value. Coinbase states that day-to-day price movements will not change the mortgage terms or produce a margin call.
Payment failures carry a different consequence. Under the product terms, Better can liquidate the pledged Bitcoin once a borrower becomes 60 days delinquent on the loan payments.
A borrower therefore retains exposure to possible Bitcoin gains but also places the pledged holdings at risk if payments stop. The two-loan structure also means the homebuyer takes on debt for the down payment instead of contributing cash at closing.
Selling Bitcoin to fund a home purchase can create US tax consequences because the Internal Revenue Service treats digital assets as property. A taxable gain or loss generally arises when a holder sells or otherwise disposes of cryptocurrency, according to IRS guidance. Pledging BTC as collateral does not involve an immediate sale, although any later liquidation could have tax consequences depending on the borrower’s circumstances.
Applicants must be US residents, maintain a verified Coinbase account in good standing, and hold enough Bitcoin to meet the collateral requirement. Better still examines credit, income, and other financial information under its underwriting policies, meaning ownership of sufficient BTC does not guarantee approval.
Coinbase does not originate the mortgage or make lending decisions. Better handles applications, underwriting, closing, escrow matters, and payment servicing, while Coinbase manages services related to the customer’s account and the transfer of collateral.
Coinbase One members can receive up to $10,000
Coinbase One members approved for eligible Better financing can receive a rebate equal to 1% of the mortgage value, capped at $10,000. Better pays the rebate as a lender credit against closing costs and records it on the borrower’s closing disclosure.
The companies have extended the offer beyond Bitcoin-backed mortgages to Better’s standard mortgages, home equity lines of credit and refinancing products. Eligible Coinbase One members have been able to apply for the expanded offer since Aug. 12.
Early demand supplied one reason for moving beyond the controlled launch. Better said, 76% of people on the June waitlist were already Coinbase One members, while 60% planned to buy a home within six months. Responses indicated more than $260 million in projected loan volume before general availability.
Ziggy Jonsson, Better Mortgage’s chief technology officer, linked the product to changes in how some younger Americans hold their wealth.
“By allowing Coinbase One members to pledge crypto as collateral without selling their holdings, we’re opening a new path toward homeownership for a generation of borrowers whose wealth increasingly lives onchain,” Jonsson said.
The present product supports Bitcoin, according to Coinbase’s current eligibility page. Earlier plans had referred to both BTC and the USDC stablecoin, but the current instructions specify that applicants need enough Bitcoin in their Coinbase account to cover the required collateral.
As previously reported by crypto.news, Better, and Coinbase disclosed the planned product in March. Details available at the time showed that buyers would receive a traditional home loan alongside a separate crypto-secured down payment loan, although the complete eligibility and collateral conditions had not yet been released.
US mortgage rules begin recognizing crypto holdings
In June, the companies funded the first Fannie Mae-backed US mortgage using Bitcoin as collateral. The loan went to a couple in Ann Arbor, Michigan, who pledged BTC rather than selling it to raise the down payment.
Better estimated at about $250 million in potential lending volume from the waitlist at the time. The completed transaction served as an early test before the product became available to qualified borrowers across the company’s market.
US housing policy had already begun making room for digital assets. In June 2025, the Federal Housing Finance Agency directed Fannie Mae and Freddie Mac to prepare proposals for considering cryptocurrency in single-family mortgage risk assessments without first converting the assets into dollars.
The directive limited consideration to holdings that could be verified through US-regulated centralized exchanges. It also instructed the two government-sponsored enterprises to account for cryptocurrency volatility and develop risk controls before submitting board-approved plans to the FHFA.
Newrez took a separate step in January 2026, announcing that it would begin considering certain cryptocurrency holdings when reviewing mortgage applications in February. Its policy covered applications for purchases and refinancing, adding another route for borrowers whose assets include digital currencies.
High housing costs provide the financial setting for the new products. Data from the US Census Bureau and Department of Housing and Urban Development, compiled by the Federal Reserve Bank of St. Louis, placed the median sales price of a new US home at about $400,000 in 2026. Better also said that high borrowing costs, expensive homes, and limited inventory pushed the median age of a first-time US buyer to 40 in 2025.
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