Better Expands Bitcoin-Backed Mortgage Product with Coinbase Partnership
Better, a mortgage provider, is expanding its Bitcoin-backed mortgage product that allows crypto holders to use BTC as collateral for a home purchase without immediately selling their digital assets. The company requires borrowers to pledge at least 250% of the down payment loan in Bitcoin, with an example being someone purchasing a $500,000 home who could pledge $250,000 worth of BTC to support a $100,000 down payment.
The product combines a standard conforming mortgage with a separate loan secured by pledged Bitcoin. Better originates and services both loans, while Coinbase provides the infrastructure used to custody the cryptocurrency collateral through Coinbase Prime. Unlike some crypto-backed lending products, this structure does not include margin calls caused by ordinary BTC price fluctuations.
Better initially launched the crypto-backed mortgage product in March, allowing eligible borrowers to pledge either Bitcoin or USDC. The company has now made the offering more broadly available while adding an incentive aimed at Coinbase One members. Eligible customers can receive a lender-funded credit worth 1% of the mortgage amount, capped at $10,000.
Crypto-backed mortgages have appeared before, with Canadian crypto lender Ledn announcing a Bitcoin-backed mortgage product in December 2021 and Miami-based fintech Milo unveiling what it described as the first U.S. crypto mortgage in January 2022. However, Coinbase's involvement gives the sector a prominent crypto infrastructure provider as BTC increasingly intersects with traditional financial services and real estate lending.