Legislators have urged Fannie Mae and Freddie Mac to limit cryptocurrency assets to those securely stored on regulated exchanges. Risks to the housing market persist, as crypto assets can be volatile and vulnerable to fraud, potentially leaving homeowners exposed. While supporters advocate for crypto mortgages to widen credit access for underqualified borrowers, critics highlight concerns about rapid price drops and margin calls threatening borrower liquidity. Ethical concerns also arise regarding potential conflicts of interest with leadership roles in housing finance agencies. Companies like Milo and Ledn currently offer crypto-backed mortgage options, adding to the complexity of this evolving market.
Lawmakers caution that expanding underwriting criteria to include cryptocurrency assets presents stability risks, as both volatility and security concerns persist, potentially threatening homeownership.
Proponents suggest crypto-backed mortgages could improve access for borrowers who cannot qualify by traditional metrics, positing that these digital assets may enhance credit opportunities.
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