Six weeks after it launched a program to accept payments in cryptocurrency, United Wholesale Mortgage (NYSE:UWM) said it would be abandoning the option entirely.
What Happened: United Mortgage, the second-largest U.S-based mortgage lender, announced Thursday that it would no longer pursue a strategy involving crypto payments for mortgages.
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“Due to the current combination of incremental costs and regulatory uncertainty in the Crypto space we’ve concluded we aren’t going to extend beyond a pilot at this time,” said the company in a statement.
The lender reportedly accepted its first-ever crypto mortgage payment in September, followed by five more crypto-denominated payments in October.
Borrowers could make payments in either Bitcoin (CRYPTO: BTC), Ethereum (CRYPTO: ETH) or Dogecoin (CRYPTO: DOGE).
The demand for making payments with crypto just wasn’t there, according to CEO Mat Ishbia.
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“There was not enough demand at the end of the day to really push the envelope too hard,” Ishbia told CNBC.
The reluctance to spend crypto on mortgage payments is potentially explained by the fact that most cryptocurrency holders are reluctant to part with their investments, viewing them more as a store of value than a typical currency.
Last month, billionaire investor Mark Cuban advised against thinking of crypto as currencies.
“Think of them [cryptocurrencies] as decentralized, secure, networked platforms with features that allow for the development of apps that can have unique utility for individuals and businesses,” he said.
Price Action: At press time, Bitcoin was trading at $59,920, gaining 4.29% over 24-hours.
United Mortgage shares were trading 4.92% higher at $7.14 Friday morning.
Photo: Executium on Unsplash.