Expanding access to credit continues to be one of the most significant issues in consumer finance. Traditional institutions and legacy systems often hinder the lending process, leading to lengthy approvals, high costs, and restricted access to capital for many consumers. In this landscape, Figure Technology is making strides by targeting the sizable $2 trillion lending market through innovative solutions that leverage blockchain and artificial intelligence (AI).
Founded in 2018, Figure began by focusing on home equity lending. However, the company has evolved into a multifaceted platform, offering a range of products that integrates loan origination, underwriting, and secondary market trading. With its recent filing to offer approximately 26.3 million shares, Figure aims to modernize the lending process by embedding advanced technologies into its operations. The company’s S-1 filing outlines its growth trajectories and expansions into various credit product markets, while simultaneously creating marketplaces for digital assets and stablecoins.
### Fragmented Lending Infrastructure
The current infrastructure supporting capital markets is characterized by fragmentation and reliance on outdated systems. According to the company’s filing, these legacy systems hinder efficiency and contribute to elevated costs. This inefficiency is primarily evident in the manual processes related to loan approvals and transaction processing, which leads to significant delays and inaccuracies.
Figure’s platform utilizes the Provenance blockchain, described as a “record of truth,” for assets. By recording every loan transaction in an immutable format, Figure enhances transparency and assures the integrity of asset ownership and performance. The company’s approach further incorporates automated valuation models and AI-driven underwriting, complemented by smart contracts to streamline loan sales and transfers. This synergy allows Figure to drastically reduce the average approval time for home equity lines of credit (HELOCs) from the industry standard of 42 days to a remarkable median of just 10 days. Additionally, applications can be completed in approximately five minutes, with funding possibly available in as little as five days.
### Market Potential and Growth
Figure estimates its addressable market across lending and capital markets at around $185 billion in annual revenue potential, derived from consumer credit originations and marketplace trading. Beyond lending, the company is also keen on pursuing opportunities in asset tokenization and stablecoins. Forecasts suggest that the asset tokenization market could soar to $16 trillion by 2030, while stablecoins may approach a valuation of around $5 trillion within the same timeframe.
The company’s profitability and capital efficiency are noteworthy. Figure has cultivated a revenue model driven by fees from loan originations, servicing, capital gains from loan sales, and technology usage fees. A significant portion—77%—of its total originations comes from partner-branded lending, where banks and mortgage originators utilize Figure’s platform under their branding, demonstrating strong external trust and collaboration. As of mid-2025, Figure maintained relationships with 168 active partners.
In addition, Figure has established a robust regulatory infrastructure to bolster its growth strategy. The company holds over 180 lending and servicing licenses, 48 money transmitter licenses, and is registered with the SEC as a broker-dealer equipped to operate an alternative trading system. On an international scale, Figure has acquired crypto licenses in jurisdictions like the Cayman Islands and Ireland, setting the stage for potential global expansion and diversification.
### Recent Developments
As of June 30, 2025, Figure has seen impressive growth in its core HELOC business, facilitating approximately $6 billion in lending—an increase of 29% year-over-year. The company’s HELOC business has maintained a remarkable compound annual growth rate (CAGR) of 70% since mid-2021.
Additionally, Figure launched the Figure Connect Marketplace in June 2024, and in its inaugural year, the marketplace processed $1.3 billion in loan volume. This platform connects lenders directly with investors, illustrating the potential for enhancing liquidity and efficiency in capital markets.
As for financial performance, the six months ending June 30, 2025, showed a net revenue of $191 million, a notable increase from $156 million in the previous year. The net income for this period was $29 million, which stands in stark contrast to the $13 million loss recorded the previous year. Adjusted EBITDA soared to $83 million, more than doubling the cash flow from the prior year.
While HELOCs account for 99% of current originations, Figure is actively piloting new products, including debt service coverage ratio loans and digital asset-backed loans. Future expansions into personal, auto, and student loans signify Figure’s ambitions to diversify its offerings and markets.
### Challenges and Risks
Despite its growth trajectory, the company acknowledges several risks associated with its operations. A significant concern is the reliance on AI for credit decisions, which may raise fair lending compliance issues under state and federal regulations. While AI integration can reduce errors substantially, regulators are increasingly scrutinizing algorithm-driven underwriting practices, particularly regarding equitable treatment across different credit tiers.
Furthermore, the broader adoption of blockchain technology faces challenges. Industry data suggests that under 1% of real-world assets are presently recorded on blockchains, raising questions about the mainstream acceptance of this approach. Figure’s foray into products like Democratic Prime and the YLDS stablecoin has yet to generate substantial revenue, reflecting the experimental nature of these new offerings.
Additionally, while the $2 trillion lending market encompasses numerous consumer asset classes, home equity lending remains Figure’s principal focus. This reliance subjects the company to market fluctuations, meaning demand for its services is cyclically linked to housing market trends and interest rates. A downturn in mortgage activity or increased consumer credit costs could adversely impact origination volumes and overall revenue growth.
### Conclusion
Figure Technology is positioning itself as a trailblazer in transforming the lending landscape through blockchain and AI, aiming to unlock a more efficient, transparent, and accessible credit system. The company’s ambitious plans, grounded in robust market potential and solid financial performance, suggest a promising trajectory. However, navigating regulatory challenges and technological adoption hurdles will be crucial for Figure as it seeks to capitalize on the evolving consumer finance ecosystem. As the company endeavors to expand its product offerings and solidify its presence in the $2 trillion lending market, its success will likely hinge on its ability to address these key risks while continuing to innovate.
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