Coinbase Lets Homebuyers Use Bitcoin as Collateral, No Selling Required

Coinbase partners with Better Home & Finance to let buyers pledge Bitcoin as collateral for down payments without selling their crypto.

Coinbase is opening a new path to homeownership for crypto holders. 

The exchange announced a partnership with mortgage lender Better Home & Finance. Together, they allow homebuyers to pledge Bitcoin or USDC as collateral for down payment loans. 

Buyers keep their crypto holdings intact throughout the process. The loan runs separately from the primary Fannie Mae-backed mortgage on the home.

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Bitcoin-Backed Loans Give Crypto Holders a New Path to Homeownership

This partnership solves a real problem for long-term crypto holders. 

Previously, buying a home typically meant liquidating digital assets to raise cash for a down payment. That triggered tax liabilities and cut off potential future gains. 

Now, buyers can secure a loan against their Coinbase holdings instead.

Reuters reported the announcement on March 26. Better originates and services the mortgage, while Coinbase facilitates the collateral arrangement. 

According to Coinbase’s head of U.S. policy, Kara Calvert, the product works within the existing mortgage system’s risk management framework. Interest rates and loan terms stay fixed regardless of Bitcoin’s price movements once the loan is active.

No Margin Calls Even if Crypto Values Drop

One major concern with crypto-backed lending is forced liquidation during market downturns. Coinbase addressed this directly. 

A company spokesperson confirmed there are no margin calls, even if the pledged crypto loses value, as long as the borrower keeps up with payments. That protection removes one of the biggest risks tied to using volatile assets as collateral.

The announcement comes as homeownership has grown increasingly out of reach. 

Data from the National Association of Realtors shows the median age of first-time buyers has climbed to 40, up from 32 in 2000. Calvert told Reuters the product aims to expand access for Americans whose wealth sits outside traditional financial accounts. 

The product also addresses long-running criticism that crypto lacks real-world utility.