FHFA Orders Fannie Mae and Freddie Mac to Recognise Crypto as Mortgage Asset

The FHFA has ordered Fannie Mae and Freddie Mac to integrate cryptocurrencies into their risk assessments for single-family loans, highlighting a push towards digital asset adoption. The directive emphasizes using U.S.-regulated exchanges for crypto assets, indicating a critical shift in institutional confidence. Following this announcement, Bitcoin’s price increased slightly, yet analysts warn of potential short-term volatility.

The Federal Housing Finance Agency (FHFA), led by director William Pulte, has made a significant announcement, instructing Fannie Mae and Freddie Mac to consider cryptocurrencies in their risk assessments for single-family loans. As detailed in a recent post on X, this decision follows a thorough review and aligns with an ongoing initiative to promote the mainstream adoption of digital assets in the U.S. spearheaded by President Trump.

The directive specifically instructs both Fannie Mae and Freddie Mac to devise a proposal treating cryptocurrency as a valid asset for reserves in their mortgage loan risk evaluations. Importantly, this should be done without converting the cryptocurrency into U.S. dollars, meaning it’s being recognized in its own right, a landmark moment in the mortgage industry.

The FHFA’s guidelines stipulate that only cryptocurrencies traded and stored on U.S.-regulated centralized exchanges, namely Coinbase Global Inc. and Robinhood Markets Inc., will be considered. This condition underscores the agency’s aim to ensure a regulated framework around the trading of these digital assets, which could offer some reassurance to both lenders and borrowers in the mortgage process.

In terms of market impact, this announcement has generated considerable buzz, especially within the web3 community. Notably, Michael Saylor, co-founder and chairman at Strategy, called this a pivotal moment for institutional acceptance of Bitcoin. It reflects a broader trend as traditional financial institutions slowly yet increasingly foster trust in digital currencies as a component of their portfolios.

After the news broke, Bitcoin’s price rose by around 1 percent, reaching approximately $107,748 during the mid-North American trading session. Yet, market analysts caution that Bitcoin may face short-term bearish sentiment unless it manages to maintain trading above $110,000 in the days ahead, making it crucial for the cryptocurrency’s enthusiasts to remain vigilant.