How to use Bitcoin for a down payment on a home

Can you use crypto to buy a home? Absolutely—but how you use it makes all the difference.

As more investors build wealth through Bitcoin, Ethereum, and other digital assets, the question of how to use that value in traditional markets, especially real estate, is becoming increasingly relevant. In particular, many are asking how to use crypto for a down payment. Do you need to sell your holdings? Can you borrow against them? What are the tradeoffs?

The mortgage industry is slowly evolving to recognize crypto as a legitimate form of wealth. While there’s progress, most traditional lenders still don’t fully understand or accept crypto when it comes to qualifying borrowers. That’s beginning to change. At Milo, we’ve helped push that shift forward by creating a crypto mortgage product where your crypto can be used directly as collateral for up to 100% financing. But we’re also realistic: the capital markets supporting these types of loans are still developing.

As a result, crypto-backed mortgages today are best suited for second homes and investment properties. If you’re looking to buy a primary residence, that doesn’t mean your crypto is off the table. You still have options, especially when it comes to using your crypto for the down payment portion.

Here are three main ways to use your crypto for a down payment, and what each approach means for your finances.

1. Sell your crypto for cash

The most straightforward method is to liquidate a portion of your crypto to generate the cash you need.

How it works You sell your BTC, ETH, or other assets, transfer the funds to your bank account, and use that cash as your down payment when applying for a traditional mortgage.

What to consider

• Capital gains taxes: Selling crypto triggers a taxable event. Depending on your holding period and cost basis, you could owe a significant amount in taxes.
• Loss of exposure: Once you sell, you’re out of the market. If the price rebounds, you don’t participate in the upside.
• Simplicity: Many traditional lenders require a paper trail showing the origin of your funds. Selling crypto and transferring to fiat is generally accepted, though you’ll need documentation.

2. Borrow against your crypto with a crypto loan

If you want to retain your exposure to BTC or ETH while still unlocking liquidity, borrowing against your crypto is a compelling option.

How it works You use your crypto as collateral to get a short-term loan in USD. That loan provides the down payment for a more conventional mortgage or other financing structure.

At Milo, for example, our crypto loans are collateralized, meaning the borrower typically posts 2x the loan amount in crypto. These loans are secured only by the crypto itself—no income, credit score, or employment verification required. Since they’re not mortgages, you can use the funds however you’d like, including for a down payment on a home.

Repayment options

• Use crypto appreciation: If BTC or ETH increases in value, you can repay the loan and reclaim your full holdings.
• Refinance later: Once you’ve purchased the property, you may choose to refinance the entire loan into a longer-term financing solution with a lower rate.

What to consider

• No taxes triggered: Since you’re not selling, there’s no capital gains event.
• Volatility matters: If your collateral drops too much in value, you may face a margin call and need to post more crypto.
• Greater flexibility: You retain control of your portfolio while accessing liquidity.

This option is especially valuable for primary homebuyers who can’t yet use a full crypto mortgage but still want to access traditional financing without liquidating assets.

3. Skip the down payment with a Crypto Mortgage

For second home and investment property buyers, there’s also the option of bypassing a down payment entirely.

How it works With a crypto mortgage, your crypto is posted as collateral for the full loan amount. There’s no need to sell your assets, and you can potentially finance up to 100% of the purchase price.

At Milo, we developed this option for clients who wanted to buy U.S. real estate using their crypto wealth without creating taxable events or losing market exposure. This loan structure doesn’t rely on income or credit documentation—it’s based entirely on your crypto holdings and the property itself.

What to consider

• Best fit for investment properties or second homes: The capital markets for crypto-backed mortgages are still evolving, which makes this structure most accessible for non-primary residences.
• Monthly payments matter: While your crypto unlocks access to homes your income might not typically support, a 100% crypto mortgage means no cash down—and higher monthly payments. Unless you're comfortable selling crypto to make payments (which we don’t recommend), you’ll need to ensure you have sufficient liquidity on hand to meet your obligations.
• Flexible structure: You can also choose to put some cash down to reduce both your monthly payments and the amount of crypto you need to post as collateral.
• Collateral is held: Your crypto is held with a qualified custodian for at least the duration of the prepayment penalty period. If the value drops significantly during that time, you may be required to post additional collateral or make loan adjustments.

Your crypto has options

Whether you choose to sell, borrow, or leverage your crypto for full financing, there’s no single right answer. It depends on your tax planning, risk tolerance, and long-term investment strategy.

What’s changing is the recognition of crypto as real wealth. Lenders are starting to catch up. While we’ve seen the most innovation on the investment property side, tools like crypto loans are already opening the door for more buyers, especially those looking to enter the primary home market without sacrificing their crypto holdings.

At Milo, we’re building these solutions because we work with crypto holders every day who aren’t just speculating—they’re planning, diversifying, and investing for the long term.

The opinions expressed in the Blog are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security or investment product.