Under mounting political pressure ahead of the midterm elections, US President Donald Trump recently made a high-profile announcement on social media: a $200 billion mortgage-backed securities purchase program. He directed Fannie Mae and Freddie Mac, two government-sponsored enterprises, to implement the plan, aiming to "drive down mortgage rates, reduce monthly payments, and make homeownership more affordable."
01 Policy Focus: "Housing Affordability" Under Election Pressure
At the start of 2026, soaring housing costs in the US have become a sharp political issue. Trump and his advisory team have repeatedly warned that the cost-of-living crisis could cost Republicans control of Congress in the midterms.
Against this backdrop, Trump announced the policy via social media and made its political intent clear, calling it "one of many measures to restore housing affordability, which the Biden administration has utterly destroyed."
Federal Housing Finance Agency Director Sandra Thompson soon confirmed that Fannie Mae and Freddie Mac would carry out the directive, purchasing $200 billion worth of mortgage-backed securities (MBS).
A key context for this policy is a decision from Trump’s first term, when he chose not to sell off Fannie Mae and Freddie Mac. This allowed both institutions to accumulate "$200 billion in cash," providing the funding for the current plan.
02 Market Mechanism: How It Impacts Rates and the Broader Economy
The core mechanism of this bond-buying program is to boost demand for mortgage-backed securities (MBS), compress their risk premiums, and thereby lower underlying mortgage rates.
Simply put, when large buyers enter the market and purchase these bonds in bulk, bond prices rise and their yields (interest rates) fall.
Fannie Mae and Freddie Mac, as government-sponsored enterprises, play a pivotal role in the mortgage market. Under existing agreements with the US Treasury, each is capped at $225 billion in mortgage investments.
As of November 2025, both companies held approximately $124 billion each, meaning they each have about $100 billion in remaining purchasing capacity.
03 Market Response: Balancing Policy Impact and Limitations
Following the announcement, markets reacted swiftly. Mortgage-backed securities rebounded against US Treasuries, and mortgage-related stocks—including Rocket Cos. Inc. and LoanDepot, Inc.—also surged.
Analysts are divided on the policy’s effectiveness. David Dworkin, President and CEO of the National Housing Conference, believes it will "put downward pressure on mortgage rates—potentially by at least 0.25 percentage points, maybe more."
Citigroup estimated late last year that if the two government-sponsored enterprises increased their portfolios by $250 billion, the risk premium on the bonds could drop by about 0.25 percentage points, which would be passed on to consumers in the form of lower mortgage rates.
However, some skeptical analysts point out that mortgage spreads have already narrowed, leaving limited policy room. Neil Dutta, Head of Economics at Renaissance Macro Research, commented, "Most of the available space seems to have been fully utilized."
According to the latest data from Freddie Mac, the average rate for 30-year mortgages was 6.16% for the week ending January 8, already near the lowest level since October 2024.
04 Crypto Market Connection: When Traditional Finance Meets Digital Assets
Trump’s policy moves often have a direct impact on crypto markets—a relationship that has become especially pronounced in 2025-2026.
Macro Liquidity Transmission: Some analysts have dubbed Trump’s move "personal QE" (quantitative easing), as its mechanism resembles the Federal Reserve’s bond-buying programs following the financial crisis.
If this plan does inject substantial liquidity into the market, some of that capital may indirectly flow into crypto markets in search of higher returns.
Policy Expectations Shift: The crypto market is highly attuned to the Trump administration’s policy direction. Some analysts suggest Trump may, in 2026, bring the cryptocurrency market into the "too big to fail" category of the financial system.
If cryptocurrencies achieve a status similar to traditional financial institutions, it could fundamentally reshape their market positioning and valuation logic.
Historical Correlation Patterns: Trump’s statements and policy announcements have repeatedly moved crypto market prices. For example, when he proposed tariffs on certain imports, Bitcoin prices saw significant volatility.
This sensitivity highlights crypto’s role as a barometer for macro risk appetite.
05 Investment Perspective: Crypto Market Insights on Gate
Professional traders on the Gate platform have begun assessing the potential impact of this policy on crypto markets. Here are several categories of crypto assets that may be affected:
| Asset Class | Potential Impact Mechanism | Market Performance Indicators |
|---|---|---|
| Major cryptocurrencies like Bitcoin | Serve as a gauge for macro liquidity and risk-off sentiment; may benefit from policy-driven market volatility and potential liquidity injection | Watch for signs of capital inflow from traditional markets and immediate price reactions following policy statements |
| Real estate-related crypto assets | Changes in US real estate activity may indirectly affect the attention and adoption of related blockchain projects | Monitor activity data for real estate tokens and mortgage-related DeFi protocols |
| Stablecoin market | Shifts in traditional market interest rates may impact stablecoin yield products and funding costs | Track changes in major stablecoin issuance, reserve asset structures, and interest rate spreads |
| Meme coins and speculative assets | Changes in market risk appetite may amplify volatility in these assets | Pay attention to sentiment indicators and the intensity of social media discussions |
Note: As of January 9, token price data on the Gate platform is continuously updated. Investors should check real-time quotes for the latest information. Crypto markets are highly sensitive to political developments, meaning such policy announcements often trigger short-term volatility. However, long-term impact should be evaluated alongside broader economic fundamentals.
06 Political Context: A Suite of Policies in the Election Cycle
This bond-buying program is not an isolated move, but part of a broader suite of housing policies from the Trump administration. Just a day before announcing the bond purchase, Trump unveiled a plan to ban institutional investors from buying single-family homes.
Federal Housing Finance Agency Director Sandra Thompson made it clear that these two policies are designed to work together to address housing affordability. Trump also stated he plans to outline additional housing affordability proposals later this month at the World Economic Forum in Davos, Switzerland.
The policy also affects the future plans of Fannie Mae and Freddie Mac. Jaret Seiberg, Managing Director at TD Cowen, believes the bond-buying program may mean initial public offering (IPO) plans for the two companies have been shelved.
Thompson revealed that Trump will decide within a month or two whether to proceed with their IPOs.
Outlook
The mortgage-backed securities (MBS) market has already responded to the policy, with risk premiums narrowing and the 30-year mortgage rate potentially falling by an additional 0.25 percentage points. Crypto market volatility reflects its acute sensitivity to Trump administration policies—a single social media post can trigger the reallocation of billions of dollars.
This "disguised QE" led by the White House isn’t just about the US housing market. It could spark ripple effects throughout the global financial system. As the boundaries of traditional finance blur, crypto assets are moving from the periphery to center stage. Whether this shift is driven by political calculation or financial innovation, the financial attributes of digital assets are being redefined.
