Bitcoin meets mortgages: Australia’s innovative approach to homeownership

Australia is taking a bold step into the future of homeownership and Bitcoin is playing a starring role. As housing affordability continues to be a major challenge, one company is offering a creative solution: Bitcoin-backed mortgages.

A new path to property ownership

Block Earner, an Australian company, has officially launched the country’s first Bitcoin-backed home loan. This innovative product allows crypto holders to leverage their Bitcoin holdings to enter the property market without having to sell their digital assets.

This launch comes after a two-year battle with regulators, culminating in a significant legal victory. In April, the Federal Court ruled that Block Earner’s crypto lending products didn’t qualify as “financial products,” paving the way for the company to offer Bitcoin as collateral for home loans without needing a financial services license.

How it works

So, how does it all work? Borrowers’ Bitcoin tokens are secured by the custody platform Fireblocks. The Bitcoin is used as collateral to secure a cash loan for up to 50% of the property’s value. This loan is then combined with a traditional mortgage to complete the financing.

This model not only creates new opportunities for Bitcoin holders but also introduces a fresh perspective on assessing creditworthiness. It moves beyond traditional factors like salary, cash savings, and superannuation, offering a more inclusive approach to lending.

Bitcoin-Backed loans: a growing trend in the US

Australia isn’t the only place exploring the potential of Bitcoin and crypto-backed mortgages. The US is also seeing movement in this space.

On June 25, Federal Housing Finance Agency (FHFA) Director William Pulte instructed Fannie Mae and Freddie Mac to investigate the possibility of counting crypto holdings on regulated centralized exchanges as reserve assets for underwriting mortgages.

In a letter, he encouraged both government-sponsored enterprises (GSEs) to consider crypto as a factor in mortgage risk assessments.

Adding to this momentum, a new bill has been introduced in the US House of Representatives that aims to require mortgage agencies to update their guidelines. This update would recognize cryptocurrency holdings on regulated exchanges as part of a borrower’s financial profile.

If this bill passes, it would allow crypto to be considered for mortgage eligibility without requiring conversion to dollars, potentially expanding access to home loans for digital asset holders.

Housing crises fuel innovation

Both Australia and the US are grappling with serious housing crises, making them fertile ground for innovative solutions like crypto-backed home lending.

Australia has gained a reputation as one of the least affordable housing markets in the world. On average, home prices are nearly 10 times the typical household income. In Sydney, homes cost almost 14 times the median income, second only to Hong Kong.

The US is also facing affordability challenges, with median home prices reaching over $420,000 in 2024–2025, roughly seven times the median household income. This situation has contributed to a surge in homelessness, reaching record levels in recent years.

According to a report from the Annual Homelessness Assessment Report (AHAR) from the US Department of Housing and Urban Development, over 653,000 people were recorded as unhoused on a single night in January 2023, the highest number since the US began tracking these figures in 2007.

Interestingly, while home prices remain high, they have actually declined relative to Bitcoin, which has surged by nearly 87% over the past year. This highlights the potential of Bitcoin as a tool for navigating the challenges of the housing market.