- Better Mortgage and Coinbase have launched their Bitcoin-backed mortgage product for general use, with total loan requests hitting $360 million.
- To obtain a mortgage, borrowers are required to deposit $2.50 worth of Bitcoin for each $1 they wish to borrow for a home down payment, while the Bitcoin is held in Coinbase Prime custody.
- This system introduces risks associated with collateral custody and liquidation, and its broader acceptance hinges on mortgage regulations, price volatility in cryptocurrency, and the development of institutional frameworks.
For the past ten years, Bitcoin has been labeled as digital property. Recently, it has begun to serve as collateral for physical assets.
Better Mortgage and Coinbase have made their Bitcoin-backed mortgage widely available, now reaching a requested loan volume of $360 million, with borrowers needing to pledge $2.50 in Bitcoin for every $1 that goes toward the deposit.
This marks a significant step for cryptocurrency in relation to everyday consumer finance, particularly through an asset that’s less adaptable in nature.
In contrast, Ethereum, Solana, XRP Ledger, and Avalanche are entering the realm of real-world finance from a different perspective.
BlackRock has introduced Ethereum-based tokenized share classes for European money market funds, managing a substantial $311 billion.
Progmat is set to transition over $2 billion worth of tokenized securities to the Avalanche network.
The statistics below—DeFi Total Value Locked (TVL), actual worth of real-world assets, and daily transaction volumes—illustrate how advanced these initiatives are.
Bitcoin (CRYPTO:BTC)
Better Mortgage, which is run by Better Home & Finance (NASDAQ:BETR), alongside Coinbase Global (NASDAQ:COIN), has broadened its Bitcoin-backed mortgage offering to a remarkable $360 million in requests, increasing from an earlier $260 million on the waiting list. Better indicated it might utilize pledged Bitcoin again if equivalent Bitcoin remains accessible for repayment.
Ethereum (CRYPTO:ETH)
Ethereum boasts a DeFi TVL of $49.5 billion, an active RWA value of $15.2 billion, and $827.9 million in DEX volume over the last 24 hours. BlackRock has debuted Ethereum-based tokenized share classes for European money market funds, which encapsulate $311 billion in total assets.
Solana (CRYPTO:SOL)
Solana features a DeFi TVL of $5.93 billion, an active RWA valuation of $2.45 billion, and $1.92 billion in daily DEX volume. Additionally, its ecosystem reported a non-stablecoin RWA value of $3.7 billion shared by 313,000 holders in late July.
XRP (CRYPTO:XRP)
XRP Ledger shows a DeFi TVL of $42.2 million, with $1.13 billion in stablecoins and 2.59 million daily transactions. Ripple has expanded its tokenization infrastructure for institutions through investments in ZILO and Licuido, along with a partnership with SettleMint scheduled for September.
Avalanche (CRYPTO:AVAX)
Avalanche records a DeFi TVL of $505.6 million, an active RWA worth $884.5 million, and 2.02 million daily transactions. Likewise, Progmat has announced intentions to move over $2 billion of tokenized securities onto the Avalanche platform.
The Conclusion
The Bitcoin (CRYPTO:BTC) mortgage exemplifies how cryptocurrency collateral is transitioning into traditional finance, while Ethereum (CRYPTO:ETH), Solana (CRYPTO:SOL), XRP Ledger, and Avalanche are exploring avenues through tokenization, stablecoins, and institutional engagements rather than focusing on mortgage lending.