Better and Coinbase test crypto-backed mortgages as 250% BTC collateral rule draws scrutiny

Better Home & Finance and Coinbase have rolled out a mortgage structure that lets borrowers pledge Bitcoin or USDC to help fund a home purchase, setting up an early test of whether digital assets can plug into the U.S. banking and housing-finance system. The product combines a conforming first-lien mortgage that meets Fannie Mae standards with a separate private loan for the down payment, backed by crypto and secured by a second lien on the property. Better said the waitlist ahead of the summer launch represented roughly $250 million in potential loan volume, and 41% of applicants lacked enough cash for a down payment. The structure has already triggered political pushback. On April 30, seven U.S. senators wrote to Federal Housing Finance Agency Director William Pulte, naming Better and Coinbase and urging the agency to revoke any approval tied to the program. Their objections centered on the product’s 250% Bitcoin collateral requirement, the cost of carrying two loans at once, and the risk that losses could ultimately be borne by taxpayers. The debate reaches past one mortgage product: it touches banking appetite for crypto-linked loans, the legal uncertainty around tokenized assets used as collateral, and Better’s own effort to lower funding costs through stablecoin-based financing.