Crypto-backed mortgages allow borrowers to use their cryptocurrency holdings as collateral for real estate loans while retaining ownership of their digital assets. This includes various types such as purchase mortgages, cash-out refinancing, and bridge loans. Unlike traditional mortgages that depend on credit history and income verification, crypto-backed mortgages utilize an asset’s value as collateral and typically have a faster approval process. However, they often come with higher interest rates due to the associated risks. The process involves finding a lender, assessing the crypto assets’ value with a loan-to-value (LTV) ratio, and moving crypto to an escrow account to secure the loan. While these mortgages provide liquidity options without selling assets and potentially offer double asset appreciation, they face challenges like price volatility, higher costs, and limited market acceptance. Borrowers must carefully assess their financial situation, understand loan terms, and consider professional advice to navigate this emerging loan type safely.

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