The two government-sponsored enterprises must draft plans that show how they will recognize borrower crypto holdings without first converting the coins to dollars.
Pulte’s signed directive instructs each enterprise to limit recognition to cryptocurrency that sits in wallets controlled by US-regulated centralized exchanges.
The order also requires the enterprises to add risk mitigants that account for market volatility and to keep reserve ratios that reflect the share of collateral held in digital assets.
Additionally, each enterprise must secure board approval before it submits the completed proposal to the FHFA conservator for review. The order is effective immediately.
Fannie Mae and Freddie Mac purchase and securitize the majority of conforming US residential mortgages. Their risk models determine the amount of capital they must hold against potential credit losses.
The directive instructs each enterprise to develop an assessment that integrates crypto reserves into its existing loan risk framework. That assessment must describe how the enterprise will value cryptocurrency, apply haircuts, and adjust for daily price swings.
The directive also requires an analysis of how crypto reserves interact with other borrower assets and liabilities. After board approval, each enterprise must send the proposal to FHFA for sign-off before implementation.
By invoking the authority to issue binding instructions that alter underwriting or capital standards, Pulte accelerated a process that otherwise would have needed rulemaking or legislative action.
The order does not change conforming loan limits or documentation requirements but expands the categories of qualifying reserves.
He added:
“Today is a historic day in the cryptocurrency industry.”
The directive follows months of internal study, according to Pulte’s remarks. The order does not specify which coins qualify. Still, the reference to US-regulated exchanges limits the pool to tokens listed on venues that follow federal know-your-customer and anti-money laundering rules.
Both enterprises must begin work on the proposals “as soon as reasonably practical,” the directive states. Pulte committed the agency to review each plan once the boards submit them but did not set a public deadline for submission.
The order remains in force unless FHFA rescinds or modifies it.
