In an innovative turn of events amid a challenging housing market, a couple from Ann Arbor, Michigan, has successfully secured a mortgage using their Bitcoin holdings as collateral, without liquidating their assets. Joe, a software engineer, and Amy, a graduate student, have become the first clients to take advantage of this groundbreaking financial product offered by Better Home & Finance in partnership with the cryptocurrency platform Coinbase.
Better Home & Finance has launched a crypto-backed mortgage, which is unique in being backed by Fannie Mae, setting it apart from similar offerings in the marketplace. This arrangement allows borrowers to leverage their cryptocurrency holdings—like Bitcoin or Circle’s USD Coin—without having to sell them, an action that would trigger taxable capital gains.
In a press release, Joe expressed his excitement about being able to purchase their first home without compromising their investments. “Buying our first home has always been the goal, but I wasn’t willing to give up a decade of investing to get there,” he said. The couple’s story is being touted as an example of modern homebuying, reflecting both the integration of technology in finance and a shift in traditional real estate practices.
However, the venture into crypto-backed mortgages is not without its critics. Financial regulation expert Hilary Allen raised concerns about the risks associated with such mortgages, cautioning that the volatility of cryptocurrencies could lead to severe financial repercussions for borrowers.
To secure a crypto-backed mortgage with Better, applicants are required to open a Coinbase account and maintain holdings in Bitcoin or USD Coin. Specifically, clients must obtain a conventional 15- or 30-year mortgage backed by Fannie Mae and then secure a second loan that replaces the standard cash down payment, with Bitcoin or USD Coin serving as collateral. Borrowers are expected to make timely payments on both loans, with strict terms in place to manage defaults—failure to keep up with payments could result in the liquidation of collateral or even foreclosure.
The profile of Joe and Amy aligns with a demographic that Better aims to serve more broadly: young, college-educated individuals who may have accrued wealth in cryptocurrencies but struggle to meet traditional down payment requirements. However, it’s worth noting that as of 2025, only 9% of Americans have invested in cryptocurrencies, which suggests that the market for such mortgage products may be limited.
Allen pointed out that the marketing of crypto-backed mortgages might create a misleading impression of a vast untapped market among potential borrowers. She emphasized the potential danger associated with tying mortgage collateral to highly speculative and volatile assets like Bitcoin, which has demonstrated significant price fluctuations in recent months.
In response to inquiries regarding these risks, Better Home & Finance indicated that it is currently preparing a statement to clarify its position on the regulations and implications of crypto-backed mortgages.
As the housing market continues to evolve in response to technological advancements and changing financial landscapes, the implications of combining cryptocurrency and traditional homeownership are still unfolding, leaving potential borrowers to weigh the innovative possibilities against the inherent risks.
