Author: Charlie Liu

On the eve of Nasdaq's "FIGR" listing, it is easy for people to see Figure as just another new stock riding the wave of cryptocurrency.

But that misreads the main storyline.

The real protagonist is a new generation of financial institutions that have moved the flow of loan funds onto the blockchain and reintegrated capital market operations back into the parent company.

As of today, Figure's offering range has been raised to $20–22 per share (previously $18–20), and there are rumors of a further increase before the opening tomorrow (September 11, 2025).

Multiple media outlets estimate the fundraising scale to be around $700 million, corresponding to a valuation of up to $4.7 billion.

Figure's Core Business Model

A decent IPO narrative usually starts with a wedge.

For Figure, this wedge points directly to the most stubborn and costly corner of consumer finance: how to fund loans before the assets are sold.

The traditional approach involves lending institutions pulling warehouse lines while signing forward-flow agreements, during which they incur legal fees, hedge interest rate risks, and bear interest costs during a "dwell time" of several weeks, waiting for the assets to reach the final buyer.

The more steps involved, the more friction there is—from a few basis points accumulating to several percentage points—because each step is a process pieced together by contracts, emails, and bulk settlements.

Figure's response is not an empty RWA concept but a redesigned closed-loop funding mechanism.

First, it generates a Home Equity Line of Credit (HELOC), tokenizes this credit on the Provenance blockchain, and lists it as collateral; then it matches funding through hourly Dutch auctions, bidding loans with YLDS (Yield Certificates).

Once a loan is completed, the asset performance and collateral status are recorded on-chain, visible to the market; repayments and fund flows operate according to programmed rules.

Figure transforms the "human-driven, intermittent access" of warehouse lines into an "automated co-opening, market-priced" funding track, creating a real-time credit access pathway.

In Democratized Prime (Figure's platform market), investors price through auctions and complete funding with YLDS.

Once the bidding is matched, funds are immediately disbursed; unallocated funds earn a base interest rate, keeping available funds in place; if the order book needs immediate liquidity, interest rates will automatically rise accordingly.

The result is not just cheaper funding but also continuity in pricing by the hour rather than by the day or week.

It achieves instant market pricing through auctions, rather than being trapped in an opaque, slow-reacting private warehouse line.

This repricing capability not only alleviates the pressure of interest rate hedging but also eliminates the "idle time tax" in traditional funding chains.

Is this worth it? Example calculations show that it is.

Taking a typical HELOC as an example, the total cost of funds and distribution under the old model is about 153 basis points of the principal; the corresponding figure for the on-chain track is about 28 basis points—saving approximately 125 basis points, which can either be passed on to borrowers as annualized costs or retained as marginal profits for lending institutions.

This is not a game of decimal places; in a world where single-digit yields drive behavior, it will change market choices, after all, investors are not doing charity.

For retail funds, this is an asset class that has been isolated by the gates of funds and trustee reports; for institutions, this is a tool that embeds price discovery mechanisms into the pipeline.

Implications for the Global Economy

This is why Figure's IPO is better described as a modernization of the credit market rather than just another cryptocurrency concept stock listing.

Compared to the trend of other asset classes moving on-chain, the demand for on-chain government bonds is real and expanding.

For example, Blackstone's BUIDL has reached the scale of several billion dollars and is even accepted as collateral for derivatives—but they are still primarily aimed at qualified investors, subject to minimum subscription amounts and whitelist controls.

Franklin Templeton's on-chain money market fund has also crossed $700 million. These are significant innovations on the supply side, but the participation threshold is still determined by traditional investor hierarchies.

Secondly, on-chain stocks also have their highlights: better liquidity and participation from small retail investors.

But they start from a "U.S. capital market premise"—the stock and bond market is the gravitational center of funds. The on-chain public and private offerings launched by Robinhood in the EU are an extension of this logic.

This certainly matters for mature markets, but it does not address the gap for economies that primarily rely on bank credit rather than market stocks and bonds as their main financing method.

In the U.S., non-bank market financing provides most of the funds, while bank loans are a small portion; but the global reality is that most economies are still bank-centered.

With few exceptions, Asian corporate sectors mainly rely on loans rather than capital markets.

Even as the corporate bond market deepens, policymakers repeatedly emphasize the "over-reliance on indirect financing."

The OECD's latest report on Asian capital markets states it plainly; the IMF, European Central Bank, and others have also repeatedly confirmed this model: when markets become turbulent, it is the banks that truly transmit monetary and fiscal policy; small and medium-sized enterprises still rely most on loan channels.

Therefore, if other countries in the world want to benefit in the long term from the current RWA boom, they should start from the fundamentals of indirect financing that Figure is involved in.

Within this framework, Figure's market resembles a blueprint rather than a one-off product.

By learning from its real-time transparency, creating a closed loop of "generation—tokenization—auction financing—on-chain service" for HELOCs, we can replicate the same closed loop for mortgages, personal loans, small and medium enterprise credit, and asset-based lending—especially in markets that primarily connect funding through bank balance sheets.

This also explains why Figure integrated Figure Markets back into the parent company before going public.

With publicly traded equity "currency" to support an integrated stack from customer acquisition, generation to distribution, it essentially declares its intention to hold the entire track in its own hands.

It is not just a retail lender with a beautiful lending system but a combination of on-chain warehouse + secondary market, compressing time, cost, and information asymmetry into the same ledger.

Skeptics may focus on compliance extensions and the structural risks surrounding YLDS.

This is necessary: after all, YLDS is not a bank deposit; it is an unsecured certificate issued by a registered entity, containing risks related to credit, interest rates, and early repayment.

Auctions bring rapid repricing, and fixed rates are only truly locked in at the final approval stage.

But these risk categories also exist in today's warehouse lines—only now they are made more transparent, procedural, and, crucially, open to a broader spectrum of fund providers.

If all of this works out, what will happen?

Borrowers' annual interest rates will be lower because that 125 basis point "tax" is shared; lending institutions will expand faster with less contractual friction; investors will gain a continuous, price-discovery-linked yield stream with a short duration tied to the real economy.

In bank-dominated economies, local lenders can tap into a global liquidity pool for auction clearing without having to wait for months for a securitization window to open.

Compared to recreating a more glamorous "on-chain facade" for U.S. stocks, this is clearly more important for the feasibility of credit markets in China, India, Southeast Asia, or Latin America.

Conclusion

Of course, the market will ultimately score Figure using boring metrics: the growth of HELOC throughput; market rates and fees; how default and early repayment curves behave amid interest rate fluctuations; and how much of the saved costs are returned to borrowers and how much is retained as platform profit.

But if you evaluate the value of RWA based on "who can truly change financing behavior outside the U.S.," then Figure's model resembles infrastructure rather than just a product.

And that is the deeper significance of this IPO.

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