Coinbase and Better Mortgage have expanded access to a home-financing product that lets eligible U.S. borrowers pledge Bitcoin instead of selling it to raise cash for a down payment.
The product moved into general availability for Coinbase One members after an earlier rollout that produced the first Fannie Mae-backed U.S. mortgage using Bitcoin collateral. Better originates and services the loans, while Coinbase provides the infrastructure used to move pledged BTC into custody.
The structure gives crypto holders a route into the conventional mortgage market without liquidating long-held Bitcoin positions before closing.
Bitcoin Covers the Down Payment Through a Second Loan
Borrowers receive two loans at closing. The first is a standard conforming mortgage designed under Fannie Mae guidelines. The second funds the cash down payment and is secured by the borrower’s Bitcoin and a second lien on the property.
Bitcoin collateral must equal at least 250% of the down-payment loan. A borrower seeking $100,000 for the down payment would therefore need to pledge roughly $250,000 in BTC.
Better holds the Bitcoin in its Coinbase Prime custody account until the mortgage is repaid or refinanced. Both loans use the same interest rate and amortization period, allowing the borrower to make one combined monthly payment.
The structure has already moved beyond testing. A Michigan couple completed the first Bitcoin-backed mortgage through Coinbase and Better in June without selling their BTC position.
Bitcoin Price Drops Do Not Trigger Margin Calls
A decline in Bitcoin alone does not force borrowers to post additional collateral or trigger liquidation. Better can liquidate the pledged BTC if the borrower becomes 60 days delinquent on payments.
That differs from Coinbase’s separate Bitcoin-backed lending product through Morpho, where falling collateral values can push a loan toward automatic liquidation based on its loan-to-value ratio.
Borrowers must still pass Better’s normal mortgage underwriting, including creditworthiness, income and other eligibility checks. The Bitcoin collateral replaces the cash needed for the down payment rather than replacing conventional mortgage underwriting.
Coinbase One members approved for eligible Better financing can receive a 1% lender credit worth up to $10,000toward closing costs. The credit also applies to Better’s standard mortgages, HELOCs and refinances.
Waitlist Points to More Than $260M in Demand
Early demand reached more than $260 million in projected loan volume before the wider rollout. About 76% of waitlist respondents were already Coinbase One members, while 60% said they expected to purchase a home within six months.
The expansion follows an earlier push to bring Bitcoin collateral into mortgages without requiring borrowers to convert their holdings into dollars before applying.
Better has also found that 41% of its pre-approved customers meet income and credit requirements but lack enough cash for a traditional down payment, creating a borrower pool that can qualify for a mortgage while holding a significant share of its wealth outside conventional bank accounts.
