Wyoming Senator Cynthia Lummis has proposed legislation that may solidify directives from U.S. housing regulators concerning mortgage buyers.
In a notice released on Tuesday, Lummis mentioned that her bill, known as the 21st Century Mortgage Act, aims to initiate a Congressional lawsuit following a June directive from the Federal Housing Finance Agency (FHFA). This directive requires U.S. mortgage entities Fannie Mae and Freddie Mac to recognize cryptocurrency as valid assets in single-family loans.
“This law opens up new opportunities for wealth accumulation, especially considering the growing number of young Americans who possess digital assets,” Lummis expressed.
However, several Senate Democrats have voiced their opposition to the FHFA’s order. They are urging overseer William Prute to “thoroughly evaluate the potential risks and advantages” of integrating this code into mortgage applications.
Concerns have been raised regarding the inherent volatility and liquidity issues associated with cryptocurrencies, suggesting that crypto borrowers may struggle to convert these assets into cash, potentially increasing the risk of defaults on mortgages.
Lummis’ legislation specifically targets young Americans who are having trouble securing affordable long-term housing. Many of these individuals have had to liquidate their crypto holdings, using them as collateral for mortgage applications. Data from the U.S. Census Bureau indicates that by the first quarter of 2025, around 36% of homeowners under 35 years old in the U.S. were homebuyers.
The Senate is preparing for a break in August, and a crypto bill is on the table
The Crypto-Operation Bill is among three pieces of legislation that the Senate may review after scheduling a month-long recess.
Alongside the Mortgage Act, Lummis is also a key Republican figure behind a Senate bill that aims to establish a regulatory framework for digital assets. This bill, which proposes to prevent the Federal Reserve from launching central bank digital currencies, is still under consideration after passing in the House in July.
Meanwhile, after a meeting suspension led by Rep. Mike Johnson, the home front has a similar crypto mortgage proposal introduced by Republican representative Nancy Mace.
The American Homeowners Crypto Modernization Act, presented by Mace on July 14, requires that mortgage lenders account for the value of digital assets held in securities accounts tied to cryptocurrency exchanges.
In another development, an Australian company, Block Horner, has announced plans to initiate a Bitcoin-backed mortgage. This announcement came after a federal court in Australia deemed the company’s crypto loan products ineligible under the nation’s corporate laws.
