Moon Mortgage debuts crypto-backed mortgage product
Moon Mortgage rolled out its cryptocurrency mortgage product to three states on Tuesday, allowing borrowers to use Bitcoin and other leading cryptocurrencies for their real estate purchases.
The lender offers crypto-backed mortgages for borrowers in Colorado, Florida and Texas with a minimum application of $1 million, it said. The company will have a traditional first lien position on the property’s title and control a borrower’s Bitcoin, Ethereum or USD Coin, which is pegged to the US Dollar.
“While the full convergence of TradFi [traditional finance] and crypto is still a long way off, we are working to bridge the gap now,” Tristan Marino, co-founder and COO of Moon Mortgage, said in a statement. “Our crypto loan product is how we do it; so that investors can truly materialize their digital wealth into real estate investments, as easily as possible and with compliance and security.”
The product is also available for investment property purchases in most states, Moon said. Expected average closing times are advertised in as few as 14 days. A borrower’s crypto assets will be stored with custodian Anchorage Digital, the nation’s first federally chartered crypto bank, the firm said.
Moon will not liquidate the collateral unless it falls by a pre-agreed value during the underwriting process, according to the company’s website. The lender also previously said they would handle servicing internally.
Tuesday’s rollout also included the debut of Moon’s Trade and Borrow product, where investors can take out loans on 1-month, 3-month or 6-month terms against their crypto assets while still maintaining the ability to trade them. Moon will not lend the cryptocurrency, will give borrowers the option to renew loans, will not require upfront payments and will not charge origination fees, it said.
“Against the backdrop of a very tough year for crypto investors, there is an obvious need to provide more options to help create tangible value – to ensure investors can have as many options as possible, just as traditional retail investors have,” Aaron Nevin, co-founder and CEO of Moon, said in a press release.
The debut comes in the middle of a “crypto winter” in which the values of the digital currencies have fallen sharply over the past 12 months. Bitcoin has fallen 38% during that time and was valued at $28,237.00 on Wednesday afternoon. Ethereum, which trades as Ether, also fell 44% over the same period to $1,908.61 on Wednesday afternoon.
Both cryptocurrencies have rallied since falling around March 10, when Silicon Valley Bank collapsed amid a trio of crypto-friendly banking failures.
Moon revealed its crypto-backed mortgage plans last year when it raised $3.5 million in a seed round led by CoinFund and Cadenza Ventures. The company is based in Miami and has four employees listed on LinkedIn, and one sponsored mortgage loan officer, according to the Nationwide Multistate Licensing System.
The company is not the first to offer crypto loan products, and is following suit Rollout of Milo Credit of a cryptocurrency security product last April. Milo Credit offers a 30-year loan term for a crypto-backed purchase or refinance loan for up to $5 million, and in September the company claimed it had reached $10 million in crypto loan volume.
Miami-based XBTO Group in April also announced that it had a crypto-backed mortgage arose, although it does not appear to still offer the product on its website. Figure Technologies has also announced a crypto loan productalthough it has not yet been rolled out.
