New Lummis Bill Would Back Effort to Ensure Crypto Assets Can Justify U.S. Mortgages

The digital assets industry's most reliable U.S. Senate ally, Cynthia Lummis, has introduced her latest crypto bill, which would ensure mortgage borrowers could use their cryptocurrency holdings to help secure their loans.

Last month, Federal Housing Finance Agency Director William Pulte directed government-backed mortgage giants Fannie Mae and Freddie Mac to come up with proposals detailing how they can include crypto holdings to underpin a mortgage. Lummis' bill would "permit the holdings of a borrower in a digital asset, evidenced and maintained pursuant to a qualified custodial arrangement, to be included in the reserves of a borrower without conversion of the digital asset to United States dollars" — essentially codifying what Pulte is already seeking.

"This legislation embraces an innovative path to wealth-building, keeping in mind the growing number of young Americans who possess digital assets," Lummis said in a Tuesday statement, suggesting those assets might help bridge the gap to otherwise unobtainable home ownership.

"We’re living in a digital age, and rather than punishing innovation, government agencies must evolve to meet the needs of a modern, forward-thinking generation.”

It's not clear whether this bill will find traction in Congress or whether it could be added to other ongoing legislation efforts. Lummis, the chairwoman of the Senate Banking Committee's digital assets subcommittee, is already working on the industry's top priority: a U.S. regulatory system for the functioning of the crypto markets.

Lummis, who represents Wyoming, has also been instrumental in the push for a federal crypto stockpile, but she faces some opposition to the mortgage idea in the banking committee. Senator Elizabeth Warren, the panel's ranking Democrat, pushed back on Pulte's effort this week, sending a letter with other Democrats to question the use of volatile digital assets in a core component of the U.S. economy.

The letter to the FHFA — also signed by Senators Bernie Sanders, Chris Van Hollen, Jeff Merkley and Mazie K. Hirono — argued the move "could pose risks to the stability of the housing market and the financial system."

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