The second-largest mortgage lender has scrapped its plan to accept payments in BTC citing regulatory uncertainty in the crypto space.
United Wholesale Mortgage, which had recently made headlines in the crypto space for being the first in the industry to accept payment for a mortgage in Bitcoin, has now eliminated the said feature citing issues related to incremental costs and regulatory fluctuations in cryptocurrency.
The second-biggest mortgage lender UWM had made its public debut via the SPAC merger in January and had begun initial testing of accepting mortgage payments in Bitcoin, but the CEO Mat Ishbia told CNBC that the feature was not worth continuing since adequate demand for payments to be made in crypto was limited among consumers.
Headquartered in Michigan, United States, the company had experimented with three different types of cryptocurrency: Bitcoin, Ether, and Dogecoin with multiple borrowers to test the initial process.
The organization had secured its first crypto payment in September with five more scheduled to be collected in October.
However, Ishbia in an interview with CNBC had further stated that the dearth of adequate demand in combination with incremental cost spikes and turbulence in crypto space had compelled the company to ditch its plan to transact crypto payments.
Furthermore, these latest developments in the sector of cryptocurrency have revealed the user mindset when it comes to treating cryptos as potential investment options.
While the prices of cryptocurrencies have risen considerably, the majority of the investors are strongly inclined towards the “HODL” (hold on for dear life) phenomenon, stimulating the practice of holding cryptos for a while, and investing them at a time when the market is ripe.
UWM has also clarified that they can put the project back on the shelf any day if there are enough borrowers in the future and the demand for payments to be made in mortgage accelerates enough for the company to secure significant revenue channels.