Fintech: Figure's $8B IPO rewiring HELOCs and prime brokerage
From HELOCs to the $2T consumer lending market
Hi Fintech Futurists —
Today’s agenda below.
FINTECH: Can Figure at $8B rewire traditional prime brokerage?
SPONSOR: Delve automates compliance—SOC 2, ISO 27001, HIPAA, GDPR, PCI-DSS and more (link here)
ANALYSIS: Understanding the $100B+ Crypto Treasury company boom (link here)
CURATED UPDATES: Paytech, Neobanks, Lending, Digital Investing
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Digital Investment & Banking Short Takes
Can Figure at $8B rewire traditional prime brokerage?
Wall Street IPOs just had their busiest week in 4 years.
Deal flow was primarily led by Fintech listings from crypto exchange Gemini, buy-now pay-later fintech Klarna, and tokenized lender Figure. Combined proceeds for 2025 are now at $27B and on track to be the biggest year since 2021; when firms raised an eyewatering $142B.
Part of the renewed interest is driven by positive performance of newly listed companies. The Renaissance IPO Index, which tracks a basket of firms that IPOd in the last 3 years, has outperformed the broader market by about +15% in the past 12 months. We remain cautiously optimistic — the environment appears risk-on, but uncertainties still loom around economic growth and the outcome of US tariff games.
Figure is in the middle of the action with its shares jumping +44% following its Nasdaq debut on Thursday, where it raised $787MM and reached a $7.62B valuation. Let’s dig in.
In 2018, Mike Cagney, CEO of fintech lender SoFi at the time, had his “aha” moment with blockchain. He understood that trustless decentralized networks could unlock massive efficiencies for networks that remain largely trust-based, like financial services. A simple trade in public equities can take up to 7 parties to settle - on blockchains it’s just the buyer and the seller.
Having built SoFi, Cagney saw a particularly strong use case in more illiquid assets like loans. The ability to digitally issue a loan with all its performance history on-chain, coupled with the ability to bilaterally trade it 24/7, could bring new liquidity to the asset class.
Cagney pitched lenders that unlocking these efficiencies could save them 85bps in origination and securitisation costs. Despite the offer, no one wanted to be the first to commit. Instead, he resorted to a more ambitious challenge: rebuilding the entire stack from the ground-up, starting with origination, and gradually migrating it on-chain.
We talked to Mike in 2020 about his plans.
Figure was founded to be a new independent lender specialising in Home Equity Lines of Credit, or HELOC. These are a niche and inefficient segment of loans, comprising about 3% of U.S. housing debt, enabling borrowers to access capital secured against their equity ownership in their home.
The core product is Figure’s proprietary loan origination system (LOS), which fully automates and digitises the application process. Features like automatic home valuations and remote notaries enables it to originate loans much faster and cheaper than the status quo. According to the company, Figure reduced the median time to fund a home equity loan from 42 days to just 10 days.
Figure originates and funds these loans in two ways:
(1) directly to consumers via the Figure brand, funded by taking on debt and subsequently selling the loans.
(2) via a whitelabel offering to third-party lenders who pay to access its origination engine and fund/ sell the loans themselves.
This is the key revenue driver of the business today.
Figure originated a combined $3.2B in loans in the first half of 2025, up a solid +27% YoY, with total revenues of $190.6M, up +22% YoY. The largest share of income comes from gains on the sale of direct-to-consumer loans (36%) and their respective servicing and origination fees (23%). The company is on track for its second consecutive year of profit, annualising at $71.6M, up from $9.2M in FY24.
However, growth is predominantly rooted in the white-label business, which now accounts for 77% of volume. This flows into Figure’s P&L via ecosystem and technology fees, which are up +250% YoY in 2025 at $44B. The company now counts 168 partners, including mortgage providers, servicers, banks, and credit unions.
The importance of this segment for Figure extends beyond just growing loan originations.
Looking at its financial statements, the company looks eerily like a pureplay digital lender. But in parallel to originating loans, the firm built and launched its own public Layer 1 blockchain, Provenance. Figure creates tokenized representations of all its combined $16.2B loans on the platform with records of underlying changes in ownership. So far, these have primarily been used to enhance the auditability of the traditional, off-chain lending process.
However, a growing network of partners originating tokenized loans gives Figure a strong distribution advantage for future DeFi applications on top of Provenance. In fact, Figure has tokenized more private credit than any other project in the space, with 54% market share over competitors like Tradable and Maple Finance.
The company has already started building out its own trading and lending markets on top. Last year, it launched Figure Connect, a marketplace for buying and selling loans directly on-chain, and Figure Exchange, which offers trading in popular tokens like ETH, BTC and margin trading.
Over half of the loans originated by Figure’s partners via its LOS were sold on Figure Connect in 2025. The company estimates partners save up to 1% by selling loans directly on Connect instead of going via off-chain intermediaries.
The longer term strategy is to grow its Democratized Prime offering on Exchange, which aims to offer a more capital-efficient approach to traditional prime brokerage. For example, users can access lending pools that enable them to borrow against HELOC loans or access margin funding for further trading activity on the Figure Exchange. Similar to Connect, institutions could benefit from lower capital requirements and better execution than the traditional off-chain process.
However, Exchange is yet to see strong adoption and hasn’t translated to any material revenue so far. Total value locked of $140MM in Figure Exchange on Provenance also lags competitors like Maple Finance, who boast over $2.3B in institutional on-chain lending pools.
Investors are still optimistic about its ability to grow this vertical going forward. The stock currently trades around 18x revenues (1H25 annualised) after IPO last week. That’s far above other digital lenders like Affirm, SoFi, and Klarna, and more in line with crypto exchanges Coinbase and Robinhood; signalling investors are betting on the firm’s ability to convert users to its on-chain markets.
Success in this segment also doubles Figure’s addressable market. In its S-1, Figure estimates the annual revenue opportunity for origination and Figure Connect to be $80B, a 4% take rate on the $2T in annual personal lending in the US. It estimates another $80B from trading for Figure Exchange, based on a 50bps take rate on the $16T in tokenized assets by 2030.
We would take these numbers with a pinch of salt, but a large opportunity nonetheless. We believe Figure has already built a strong business in HELOC origination, but long-term success in tokenization will largely depend on its ability to translate its current moats in distribution and compliance to meaningful capital on Provenance.
👑 Related Coverage 👑
Long Take
We analyze the mechanics behind Digital Asset Treasuries (DATs), highlighting how they differ from ETFs, SPACs, and direct crypto holdings. DATs are public companies that actively manage treasuries of crypto assets, using strategies such as staking, restaking, leverage, and operating businesses to enhance returns. A modeled DAT shows that with $1B in PIPE financing and monthly capital raises, the treasury grows quickly if ETH appreciates and mNAV multiples expand. Performance hinges on assumptions like leverage, market premiums, and asset appreciation — DATs work best when actively managed and bullish macro conditions support the underlying token and equity structure.
Curated Updates
Here are the rest of the updates hitting our radar.
Paytech
⭐PayPal introduces payment links - Payments Dive
Bank of England stablecoin limits slammed by UK crypto groups - FT
Native Markets team wins Hyperliquid USDH stablecoin bid - The Block
Plaid to pay JPMorgan for access to customer data - Finextra
Neobanks
Chime rolls out Credit Card - Forbes
Revolut to allow staff to sell shares at $75bn valuation - FT
Payments business Wise investigates becoming a UK bank - The Times
Lending
⭐ Uber partners with fintech firm Pipe to offer capital to SMEs - CNBC
Klarna valued at nearly $20 billion as shares jump in NYSE debut - Reuters
Digital Investing
⭐ BlackRock Looks To Tokenize Its Blockbuster ETFs - Bloomberg
Nasdaq makes push to launch trading of tokenized securities - Reuters
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This is a great insight to figure and how finance business can be generated… thank you
Just for reference I did try and investigate a property with Figure.
Just to look and see what is on offer !!
This product is currently not available in Texas.
Which is something I find with other various financial services being offered in the USA !