FHFA Cryptocurrency Asset Reserves Rule: What You Need to Know

In June 2025, the Federal Housing Finance Agency (FHFA) introduced new rules governing the use of cryptocurrency asset reserves in mortgage applications. These rules mark a significant step toward integrating digital assets into the mainstream mortgage process, but they also introduce new requirements for borrowers and lenders. This article provides a comprehensive overview of the FHFA’s cryptocurrency asset reserves rule, what it means for all parties involved, and how to navigate the new landscape.

What is the FHFA Cryptocurrency Asset Reserves Rule?

The FHFA’s new rule sets out clear standards for when and how cryptocurrency assets can be counted as reserves in mortgage underwriting. Asset reserves are funds that borrowers must have on hand after closing to cover a certain number of monthly mortgage payments, providing a safety net for both lenders and borrowers.

Key Provisions of the Rule

• Eligible Cryptocurrencies: Only certain digital assets—such as Bitcoin, Ethereum, and select stablecoins—are eligible to be counted as reserves. These assets must be held in regulated, US-based exchange accounts.
• Verification and Documentation: Borrowers must provide detailed documentation, including official exchange statements, transaction histories, and proof of asset origin. Third-party verification or CPA attestation may be required.
• Valuation Method: Lenders are required to use a 30- or 60-day average balance to value crypto reserves, smoothing out short-term volatility and providing a more stable assessment of asset value.
• Liquidity and Accessibility: Crypto assets must be easily convertible to US dollars. Lenders may require evidence of recent conversions or the ability to liquidate assets quickly if needed.
• AML and KYC Compliance: All assets must comply with anti-money laundering (AML) and know-your-customer (KYC) regulations. Lenders must verify the legitimacy and source of funds.

What This Means for Borrowers

The new rule opens up new opportunities for homebuyers with significant crypto holdings, but it also introduces new responsibilities:

• Expanded Access: Borrowers can now use eligible crypto assets to meet reserve requirements, potentially making it easier to qualify for a mortgage.
• Stricter Documentation: Applicants must be prepared to provide thorough, organized documentation of their crypto assets, including proof of ownership, transaction history, and average balance calculations.
• Conversion Readiness: While you may not need to convert your crypto to USD immediately, you must demonstrate that your assets are liquid and can be converted quickly if needed.
• Compliance Burden: Borrowers must ensure their assets and transactions comply with AML and KYC rules, which may require additional verification or third-party attestation.

What This Means for Lenders

Lenders must adapt their processes to comply with the FHFA’s new rule:

• Enhanced Due Diligence: Lenders must implement rigorous verification and risk assessment procedures for crypto reserves.
• Standardized Documentation: The rule calls for standardized forms and processes for documenting crypto holdings and average balances.
• Staff Training: Lenders will need to train staff on the nuances of crypto asset verification, compliance, and risk management.
• Ongoing Monitoring: Lenders are expected to monitor crypto market conditions and update risk models as needed.

Documentation and Compliance Tips

• Gather Official Statements: Download recent account statements from all exchanges where you hold eligible crypto assets.
• Calculate Average Balances: Use 30- or 60-day average balances as required, and provide clear calculations and supporting data.
• Obtain Third-Party Verification: If required, engage a CPA or financial advisor to review your holdings and provide an attestation letter.
• Organize Records: Keep your documentation organized by date and account. Annotate or highlight large transactions or transfers.
• Stay Up to Date: Monitor FHFA updates and lender communications for changes or clarifications to the rule.

Best Practices for Borrowers and Lenders

• Start Early: Begin gathering documentation and preparing for compliance well before applying for a mortgage.
• Work with Experts: Engage professionals experienced in crypto asset verification and mortgage compliance.
• Be Transparent: Disclose all relevant assets and transactions, and be prepared to explain the source and movement of your funds.
• Ask Questions: Don’t hesitate to seek clarification from your lender or advisor about any aspect of the rule or application process.

Common Questions About the FHFA Crypto Asset Reserves Rule

Q: Can I use any cryptocurrency as reserves? A: Only approved cryptocurrencies held in regulated exchange accounts are eligible. Always check with your lender and review the FHFA’s current guidelines.

Q: Do I have to convert my crypto to USD to count as reserves? A: Not necessarily, but you must demonstrate liquidity and the ability to convert quickly if needed.

Q: What if my documentation is incomplete? A: Incomplete or unclear documentation can delay or jeopardize your mortgage approval. Work with your lender and professionals to ensure all records are accurate and complete.

The Bottom Line

The FHFA’s cryptocurrency asset reserves rule is a major step toward integrating digital assets into the mortgage process. By understanding the new requirements, preparing thorough documentation, and working with experienced professionals, borrowers and lenders can take advantage of the opportunities created by this groundbreaking policy.