Catenaa, Sunday, August 03, 2025- A group of senior Democrat Senators expressed strong concerns over a recent Federal Housing Finance Agency (FHFA) directive allowing mortgage lenders to include unconverted cryptocurrency as part of loan underwriting.
Senators Jeff Merkley, Elizabeth Warren, Bernie Sanders, Chris Van Hollen, and Mazie Hirono warned that the policy could expose consumers and the housing market to significant risks.
In a July 25 letter to FHFA Director William Pulte, the senators flagged crypto’s historic volatility, liquidity challenges, and vulnerabilities to hacks and scams, emphasizing potential dangers for borrowers relying on digital assets to secure mortgages.
They cautioned that the inability to quickly convert crypto to cash at stable prices might increase default risks.
The FHFA order, issued June 25, directs Fannie Mae and Freddie Mac to prepare proposals treating cryptocurrency as eligible assets for mortgage risk assessments without requiring conversion to U.S. dollars. The move aligns with broader efforts to integrate crypto into mainstream finance, drawing praise from some industry figures, including former Binance CEO Changpeng Zhao.
Still, the senators argued that expanding underwriting criteria to include unconverted crypto could destabilize the housing and financial markets, urging a cautious approach.
The debate underscores ongoing tensions in U.S. regulatory policy as digital assets continue gaining traction in traditional finance sectors.
