Better and Coinbase's bitcoin-backed mortgages allow rehypothecation of collateral, borrowers cannot recover crypto until mortgage is fully repaid
Better Mortgage, in partnership with Coinbase, has made its bitcoin-backed home loan product generally available. The company disclosed that it may reuse the pledged bitcoin collateral, provided it keeps an equivalent amount available to return. Borrowers cannot recover their crypto until the conventional mortgage is fully repaid or refinanced, a condition that could keep the bitcoin encumbered for 15 or 30 years. Unlike typical crypto-backed loans, a decline in bitcoin's price does not trigger a margin call or automatic sale; liquidation only occurs after payment delinquency. Better reported pre-applications reaching $360 million in requested loan volume since the public launch.
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Source:CoinDesk · Source Link
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