Fannie Mae and Freddie Mac to Assess Crypto for Mortgages – Coincu

PANews reported that FHFA Director Bill Pulte has mandated Fannie Mae and Freddie Mac to draft strategies for cryptocurrency inclusion in mortgage risk assessment assets.

The initiative seeks to modernize mortgage qualifications by recognizing crypto stored on U.S.-regulated exchanges as assets.

Crypto Integration Could Transform U.S. Mortgage Standards

Bill Pulte, the FHFA Director, has instructed Fannie Mae and Freddie Mac to devise a plan to incorporate cryptocurrencies into mortgage risk assessments. This directive is part of an effort to align with initiatives to position the U.S. as a leader in crypto finance. The proposed policy requires approval from the boards of the agencies and the FHFA before implementation.

The adoption of cryptocurrencies as mortgage assets may lead to significant changes in how borrowers’ financial profiles are evaluated. This policy could expand access to mortgage loans for crypto investors and potentially spur interest in compliant exchanges. However, it explicitly excludes assets held in non-compliant exchanges, ensuring adherence to U.S. regulations.

Reactions to the policy shift vary within the financial community. Bill Pulte stated, “After significant studying, and in keeping with President Trump’s vision to make the United States the crypto capital of the world, today I ordered the Great Fannie Mae and Freddie Mac to prepare their businesses to count cryptocurrency as an asset for a mortgage.” Bitcoin Magazine

Potential Volatility as Crypto Prices Surge to Record Highs

Did you know? The U.S. government previously backed only traditional assets for mortgages. This shift marks a rare instance of accommodating digital currencies in historically conservative financial instruments.

Bitcoin (BTC), a central asset in this initiative, currently trades at $107,411.28 with a total market capitalization of $2.14 trillion according to CoinMarketCap. Its market dominance stands at 65.04%, backed by a trading volume of $51.79 billion. BTC has experienced notable price fluctuations recently: rising 1.44% over 24 hours and 23.18% over the past 90 days.

Analysts from the Coincu research team highlight the potential financial, regulatory, and technological impacts of this policy. Financial markets might experience volatility if investor sentiment shifts towards compliant crypto exchanges. Regulatory adherence will play a pivotal role in ensuring the success of this initiative while technological advancements will continue to integrate cryptocurrencies into existing financial systems.