As cryptocurrency continues to transition from niche speculation to everyday finance, more home buyers are asking: Can I use crypto for mortgage borrowing?
The notion of using crypto for mortgage borrowing is not theoretical anymore. Innovative lenders are offering crypto mortgages, while buyers have begun using crypto for down payments or even brokers/ lenders who will accept digital assets as collateral.
This guide outlines how crypto is changing home buying, what risks and opportunities can be realized, and what you should know if you are using crypto and home buying in 2025.
What Does It Mean to Use Crypto for Mortgage Borrowing?
Historically, banks have not taken Bitcoin or Ethereum directly for loan payments or collateral but that is changing.
A crypto for mortgage borrowers will typically fall into one of two categories:
· Selling crypto for cash as a down payment
· Crypto-backed mortgages where your crypto acts as collateral but you keep ownership
This will provide flexibility for investors who have large crypto wealth but do not want to liquidate in a bear market.
Crypto-Backed Mortgages Explained
Crypto-backed mortgages allow a borrower to use their cryptocurrency as collateral to secure a loan without selling it.
How it works:
· You deposit Bitcoin or Ethereum into a custody account.
· The lender will assess the market value of the deposited crypto and apply a Loan-to-Value (LTV) ratio (typically 30 to 50%).
· The lender will provide you fiat currency to purchase your home while locking the cryptocurrency as collateral.
Pros:
· You can avoid triggering capital gains tax by not selling the crypto.
· You maintain upside potential if the price of the cryptocurrency appreciates.
· This is an alternative for a borrower who has strong cryptocurrency holdings but few traditional credit options.
Cons:
· As prices are often volatile, there is a possibility of margin calls when the value of the crypto falls.
· Limited lender options as this is still a niche offering.
· Regulatory scrutiny will depend on the country.
Example: Milo’s crypto mortgage program allows U.S. buyers to secure 30-year fixed-rate mortgages by pledging Bitcoin or Ethereum as collateral, without selling their crypto or making a cash down payment.
Using Crypto for Down Payment
Many buyers also elect to utilize digital currency for down payment whereby the buyers liquidated some asset in place of cash.
Advantages
· Easy to convert to cash.
· Normally well accepted by traditional mortgage lenders once converted.
Disadvantages
· Liquidating triggers a taxable event.
· Crypto pricing can be quite volatile, therefore selling your crypto in a dip reduces your purchasing power.
· Banks don’t typically want to see crypto as closing day, they want fiat.
Pro Tip: Consult a tax advisor before liquidating large crypto holdings to fund a home purchase.
Who Are Crypto Mortgage Lenders?
A growing number of crypto mortgage lenders are emerging to meet demand:
| Lender | Description | Target Audience |
| Milo | Offers crypto-collateralized mortgages with up to 100% Loan-to-Value (LTV) for certain buyers. | Crypto-savvy buyers wanting full financing without selling assets. |
| Figure | Piloting blockchain-based lending processes for faster, transparent loan approvals. | Tech-forward borrowers looking for innovative mortgage solutions. |
| Ledn | Provides Bitcoin-backed loans that can indirectly support mortgage needs. | Investors with significant BTC holdings seeking liquidity without liquidation. |
Crypto and Home Buying: Key Considerations
Prior to making any decisions, think about this important account for crypto and home buying in 2025:
· In 2025, crypto remains a high-risk arena. Analysts note that daily swings of 10–20% are common, especially for altcoins.
· This volatility directly impacts loan-to-value (LTV) ratios. Lenders like Milo often require 50–60% LTV, meaning borrowers must pledge 2x the loan amount in crypto to buffer against price drops.
Global Trends and Regulation
The environment is changing quickly:
· In the year 2025, U.S. regulators have started to mandate that lending giants consider crypto for mortgages and are requiring traditional lenders to assess crypto risk frameworks.
· Europe’s MiCA framework will clarify banks will now be able to hold crypto collateral.
· Australia and Singapore are trialing regulated crypto-lending products for the real estate market.
Benefits of Using Crypto in-Home Financing
Why would anyone want to use crypto for a house?
· Unlocks liquidity without selling during market lows.
· Diversifies financing options beyond traditional banks.
· Appeals to crypto investors with large holdings but limited fiat income history.
· May simplify international transactions in cross-border real estate deals.
Risks of Crypto-Backed Mortgages
But it’s not all upside. Using crypto for mortgage borrowers carries real risks:
· Margin calls during price drops can force borrowers to post more collateral or risk liquidation.
· Limited lender choices mean less competition on rates and terms.
· Tax complexity if selling crypto for down payments triggers gains.
· Regulatory uncertainty, rules may change mid-loan term.
Tips for Crypto Mortgage Borrowers
· Work with crypto mortgage lenders that have clear custody and margin policies.
· Keep extra collateral available to manage price dips.
· Consult a tax advisor to understand implications of selling crypto for down payments.
· Stay updated on local regulations, what’s allowed in the U.S. might be restricted elsewhere.
Conclusion
For a larger and larger segment of investors, crypto is no longer purely speculative wealth. It’s an asset that can facilitate real world purchases, including your next home.
While maybe still niche, crypto-backed mortgages, using crypto for your down payment, and other innovative products are changing the landscape of crypto and home buying.
Regardless if you’re a crypto-rich investor, or just looking to explore your options, understanding the opportunities and risks available to mortgage borrowers looking to leverage crypto will be important in 2025.
FAQs
A crypto-backed mortgage allows investors to pledge Bitcoin or Ethereum as collateral instead of selling it. The cryptocurrency, at least for a limited time, will be held in custody, you can access fiat to purchase a home, and you can pay your capital gains taxes at tax time. The flip side is that you are responsible for crypto price volatility.
Yes, you can use crypto as a down payment by selling it for fiat. This is the normal process used, it is important to remember this triggers a taxable event and you must time the sale appropriately so you are not forced to sell your crypto at the market low.
Many lenders now offer crypto mortgage loans, some such as Milo, and Ledn allow borrowers to pledge a portfolio of crypto assets as collateral. The lenders are targeting wealthy individuals who have a balance sheet rich in crypto assets, and are seeking alternative sources of financing without liquidating their assets.
Crypto and home buying comes with risks like market volatility, potential margin calls, and tax complexity if you sell. Regulatory changes can also impact loan terms or availability.
Most lenders will set low loan-to-value ratios and many are over-collateralized to account for crypto swings. If your collateral declines too much in price, you may need to post more funds for collateral or become land-locked with the lender as a result of liquidation after the margin call.
