US Senator Cynthia Lummis has introduced a bill that could change the approach to mortgage lending. The initiative centers around allowing the inclusion of cryptocurrency holdings in borrower assessments.
Key Provisions of the Bill
The proposed **21st Century Mortgage Act** aims for Fannie Mae and Freddie Mac to consider cryptocurrency holdings when determining eligibility for home loans. Digital assets, securely recorded on blockchain ledgers, including Bitcoin and Ethereum, will be evaluated alongside traditional income and credit metrics. Moreover, the legislation bans requiring borrowers to convert their crypto holdings into fiat currency during the mortgage qualification process.
Significance for the Housing Market
Cynthia Lummis emphasized that the bill "embraces an innovative path to wealth-building" and aims to support younger Americans who hold digital assets as a significant share of their net worth. This would be the first time U.S. federal mortgage policy formally recognizes digital currencies as part of borrower assessments. Should the bill pass, it could reshape underwriting guidelines used by Ginnie Mae-backed institutions, potentially expanding mortgage approvals for millions of crypto-holding consumers.
Future of the Legislative Initiative
The legislation is still in its early stages. Key details—such as which crypto assets qualify, valuation methodology, and how risk is assessed—await further clarity from policymakers and regulators. Critics have raised concerns over the volatility of crypto, custody issues, and borrower protection. Still, proponents argue this is an important modernization of lending policy, aligning with broader efforts to integrate digital finance into traditional systems.
Senator Lummis’s proposed mortgage bill in the era of cryptocurrency represents a forward step in adapting mortgage lending to contemporary financial realities. Questions regarding its implementation and potential risks remain open.
