Figure Heloc

Figure Technologies has positioned its tokenized HELOC product (FIGR_HELOC) as the world's largest blockchain-based real-world asset platform, claiming $12.5 billion in market capitalization as of September 2025. However, significant data discrepancies and regulatory complexities surrounding this innovative lending platform warrant careful examination by crypto investors.

Key Takeaways

• Market Position: FIGR_HELOC represents the largest tokenized real estate lending platform by claimed market capitalization, with Figure Technologies completing a successful $787.5 million IPO on NASDAQ (FIGR) in September 2025.

• Data Controversy: Critical discrepancies exist between Figure's reported $12.5 billion total value locked and third-party verification showing only $45 million in verifiable on-chain activity, according to DeFiLlama analysis.

• Regulatory Leadership: Figure maintains comprehensive regulatory compliance with SEC registration, FINRA broker-dealer status, and 180+ state lending licenses, positioning it ahead of most blockchain-based competitors.

• Financial Performance: The company demonstrates strong traditional metrics with $190.6 million in revenue for the first half of 2025 and achieved profitability after years of losses.

• Technical Innovation: Built on the purpose-designed Provenance blockchain using Cosmos SDK, Figure has processed over $50 billion in blockchain transactions since 2018.

• Competitive Advantages: Claims 93% cost reduction versus traditional lenders and median funding time of 10 days compared to industry standard of 42 days.

Background: Figure and the HELOC Product Context

Figure Technologies emerged in 2018 as founder Mike Cagney's response to inefficiencies in traditional home equity lending. Cagney, the former CEO of SoFi, identified blockchain technology as a solution to reduce the costly intermediation plaguing mortgage markets. The company's thesis centered on eliminating traditional friction points that make home equity loans expensive and slow to process.

The U.S. home equity market represents $33.8 trillion in available equity as of May 2024, marking a 73% increase from previous periods. Traditional HELOC processing involves numerous intermediaries, manual document verification, and settlement periods extending 30-100 days. Figure's blockchain-based approach promised to compress these timelines while reducing costs through automated smart contracts and immutable record keeping.

Figure initially focused on direct-to-consumer lending but pivoted to a business-to-business-to-consumer model by 2024. This strategic shift enabled the company to scale through 168+ partner relationships while building Figure Connect, a blockchain-based marketplace for institutional loan trading launched in June 2024. The marketplace has facilitated $1.3 billion in HELOC volume during its first 12 months of operation.

The company's evolution culminated in a highly successful initial public offering on September 11, 2025. Figure's shares priced at $25, above the initially proposed $20-22 range, and opened at $36 per share—a 44% premium that valued the company at approximately $5.3 billion. The IPO raised $787.5 million, providing capital for expansion beyond HELOCs into broader consumer credit products.

Figure's leadership transitioned in April 2024 when Michael Tannenbaum replaced Mike Cagney as CEO, though Cagney remains executive chairman. This change coincided with the company's preparation for public markets and expansion of its institutional marketplace business, which generated $45 million in revenue during the first half of 2025 compared to just $200,000 in the prior year.

What is FIGR_HELOC?

FIGR_HELOC represents a tokenized version of home equity lines of credit originated by Figure Technologies and recorded on the Provenance blockchain. Unlike traditional HELOCs that exist as database entries at individual banks, FIGR_HELOC tokens create tradeable digital representations of real estate debt secured by borrowers' home equity.

Each FIGR_HELOC token maintains a theoretical 1:1 backing ratio with underlying home equity loans. When Figure originates a HELOC through its digital platform, the loan details are hashed and recorded on the Provenance blockchain through smart contracts. This creates an immutable ownership record that can be transferred between institutional investors without traditional settlement delays.

The tokenization process begins when borrowers complete Figure's five-minute online application. Figure's artificial intelligence-powered underwriting system, integrated with OpenAI GPT and Google Gemini, evaluates creditworthiness and property values automatically. Upon approval, borrowers can access funds within five days—significantly faster than the 42-day industry median.

Once originated, these HELOCs become tradeable assets on Figure Connect, the company's institutional marketplace. Institutional investors can purchase FIGR_HELOC tokens representing ownership interests in diversified loan pools. The blockchain infrastructure enables same-day settlement (T+0) compared to traditional mortgage-backed securities that require weeks or months to transfer ownership.

FIGR_HELOC tokens trade at approximately $1.00 per token as of September 2025, with a total circulating supply of 12.25-12.35 billion tokens according to various data sources. The tokens generate yield through underlying borrower payments, which are automatically distributed to token holders through smart contract execution.

However, these tokens are not available to retail crypto investors. FIGR_HELOC tokens are classified as securities under U.S. law and are restricted to institutional investors who meet accreditation requirements. Individual investors can gain exposure to Figure's business through FIGR stock on NASDAQ, but cannot directly purchase the tokenized loan assets.

Technical Architecture and Mechanics

Figure's technical infrastructure centers on the Provenance blockchain, a purpose-built financial blockchain developed using the Cosmos SDK framework. Unlike general-purpose blockchains like Ethereum, Provenance was designed specifically for financial services applications, incorporating features like privacy preservation, regulatory compliance, and institutional-grade performance.

The blockchain operates using a Proof-of-Stake consensus mechanism with over 70 validators securing the network. Built on CometBFT (formerly Tendermint), Provenance provides instant finality, meaning transactions cannot be reversed or reorganized once confirmed. This eliminates the settlement risk common in traditional financial markets where trades can be reversed days after execution.

On-Chain Components

Figure's on-chain architecture records several critical data elements that enable the tokenized lending system to function. Smart contracts capture loan origination records with cryptographic hashes of all underlying documentation. While personally identifiable information remains off-chain for privacy protection, the blockchain maintains verifiable fingerprints of every document and data point used in underwriting decisions.

The Provenance blockchain stores ownership registry information that determines who controls each tokenized loan asset. When institutional investors purchase FIGR_HELOC tokens through Figure Connect, the ownership transfer is recorded immutably on-chain. This eliminates the reconciliation processes that plague traditional securitization markets, where multiple parties maintain separate databases that must be constantly synchronized.

Payment processing also occurs on-chain through smart contracts that automatically apply borrower payments to principal and interest according to predetermined waterfall structures. When borrowers make HELOC payments via ACH transfers, Figure's systems trigger smart contract execution that distributes funds to token holders in real-time.

Asset pledging and financing transactions are similarly recorded on-chain. When institutional investors use their FIGR_HELOC tokens as collateral for additional borrowing, the blockchain creates immutable lien records that all parties can verify independently. This eliminates the title insurance and legal documentation typically required for asset-backed financing.

Off-Chain Infrastructure

While ownership and financial flows occur on-chain, Figure maintains substantial off-chain infrastructure to protect borrower privacy and comply with financial regulations. The Client Execution Environment (CEE) processes sensitive data like Social Security numbers, income verification, and credit reports without exposing this information to the public blockchain.

Figure's off-chain systems handle the complete loan origination workflow, including credit decisioning, property valuation through automated valuation models, and document generation. The company integrates with traditional financial infrastructure including credit bureaus, bank account verification services, and electronic signature platforms to create a seamless borrower experience.

Document storage remains off-chain using traditional cloud infrastructure, but cryptographic hashes of all documents are recorded on-chain for verification purposes. This approach allows Figure to prove document integrity without exposing sensitive borrower information to unauthorized parties.

The company operates its own loan servicing infrastructure to collect monthly payments from borrowers. These systems interface with the blockchain to trigger smart contract execution when payments are received, but the underlying payment processing relies on traditional ACH networks and banking relationships.

Smart Contract Implementation

Figure's smart contract architecture uses Provenance's Metadata module to create Financial NFTs representing each loan asset. These NFTs contain unique Scope data structures that define the loan's characteristics, payment terms, and ownership rights. Unlike simple ERC-721 tokens, Financial NFTs incorporate complex business logic specific to mortgage lending.

The smart contracts automatically enforce compliance requirements coded directly into the token structure. For example, accredited investor requirements, holding period restrictions, and transfer limitations are programmatically enforced rather than relying on manual compliance processes. This reduces regulatory risk while enabling 24/7 trading capabilities.

Settlement occurs through omnibus bank integration, where Figure maintains settlement tokens backed by traditional bank deposits. When investors purchase FIGR_HELOC tokens, the transaction triggers simultaneous blockchain ownership transfer and traditional banking settlement. This hybrid approach provides blockchain benefits while maintaining compatibility with existing financial infrastructure.

Technical Performance Metrics

As of June 30, 2025, Figure processes over $600 million in monthly loan settlements through the Provenance blockchain. The platform handles thousands of daily transactions with average confirmation times under 10 seconds. Gas fees remain predictable through Provenance's fixed fee structure, avoiding the volatility common on Ethereum-based applications.

Figure has developed extensive GitHub repositories supporting its blockchain integration, with 58 public repositories containing infrastructure tools written primarily in Kotlin, Go, and JavaScript. Key projects include gas-price-service for fee management, p8e-gradle-plugin for smart contract development, and object-store-gateway for off-chain data management.

The technical infrastructure has enabled Figure to process over $50 billion in total blockchain transactions since 2018, representing the largest real-world asset deployment on any blockchain platform. However, this figure includes both on-chain and off-chain activities, leading to disputes about the actual extent of blockchain-native activity.

Tokenomics and Economics

FIGR_HELOC token economics reflect the underlying performance of Figure's home equity loan portfolio rather than speculative trading dynamics common in most cryptocurrency markets. Token value remains stable near $1.00 because each token represents a claim on dollar-denominated loan payments rather than a volatile digital asset.

The total token supply of approximately 12.35 billion FIGR_HELOC tokens corresponds to Figure's outstanding loan portfolio of $11.7 billion as of September 2025. Token issuance occurs when Figure originates new HELOCs and records them on the blockchain, while tokens are retired when borrowers repay their loans in full. This creates an organic supply mechanism tied to real-world lending activity rather than arbitrary token emission schedules.

Revenue Distribution Model

FIGR_HELOC tokens generate yield through borrower interest payments, which are distributed to token holders after deducting Figure's servicing fees. Current HELOC interest rates range from approximately 7-12% annually depending on borrower creditworthiness and loan-to-value ratios. Figure typically retains 100-200 basis points as servicing spread, with the remainder flowing to institutional investors holding the tokens.

Monthly payment distribution occurs automatically through smart contracts as borrowers make HELOC payments. Unlike traditional mortgage-backed securities that distribute payments quarterly, blockchain automation enables monthly cash flows that improve investor liquidity. Payment timing is predictable because smart contracts execute immediately upon payment receipt rather than waiting for manual processing.

Figure also generates revenue through origination fees charged to borrowers and transaction fees on the Figure Connect marketplace. Origination fees typically range from 1-3% of loan amount, while marketplace transaction fees average 0.5-1% of trade value. These revenue streams support Figure's operations without diluting token holder returns.

Market Capitalization Analysis

The claimed $12.5 billion market capitalization for FIGR_HELOC tokens represents the aggregate outstanding balance of tokenized home equity loans as of September 2025. This figure positions FIGR_HELOC as the largest tokenized real-world asset project globally, exceeding the combined market capitalizations of most traditional cryptocurrencies.

However, significant discrepancies exist in reported metrics. DeFiLlama, a leading DeFi analytics platform, reports only $44.96 million in verifiable total value locked for Figure's platform as of September 2025. This massive discrepancy stems from DeFiLlama's methodology that only counts assets held in smart contracts on public blockchains, while Figure includes off-chain loan balances backed by on-chain ownership records.

The dispute highlights fundamental questions about measuring blockchain-based real-world assets. Figure argues that $11.7 billion in loan balances are "blockchain-native" because ownership rights are recorded on-chain even if the underlying cash flows occur through traditional banking systems. Critics contend that true blockchain assets must be held and traded entirely on-chain without reliance on off-chain infrastructure.

Trading Dynamics and Liquidity

FIGR_HELOC tokens trade primarily on Figure Markets, the company's internal exchange, with reported 24-hour volumes ranging from $10-28 million as of September 2025. However, these tokens are not available to retail investors and cannot be purchased through standard cryptocurrency exchanges like Coinbase or Binance.

Institutional trading occurs through Figure Connect, where qualified investors can purchase tokens representing diversified loan pools. The marketplace uses Dutch auction mechanisms for price discovery, with transactions settling in real-time through blockchain infrastructure. Settlement speed represents a major advantage over traditional asset-backed securities markets where trade settlement can take weeks or months.

Secondary market liquidity remains limited compared to traditional financial markets because the investor base consists entirely of accredited institutions. Figure reports 27 marketplace participants as of June 2025, a relatively small ecosystem compared to public securities markets. Limited participant count constrains price discovery and may create liquidity challenges during market stress.

Economic Incentive Structure

Figure's business model creates aligned incentives between the company, borrowers, and institutional investors. Borrowers benefit from faster approvals and lower costs compared to traditional banks. Figure estimates 93% cost reduction for borrowers through elimination of intermediary fees common in traditional mortgage origination.

Institutional investors receive higher yields than comparable fixed-income investments while gaining exposure to secured real estate debt. Home equity lending historically demonstrates lower default rates than unsecured consumer credit due to collateral backing. Figure's focus on prime borrowers with substantial home equity further reduces credit risk.

Figure's revenue model depends on continued loan origination and marketplace activity rather than token price appreciation. This structure incentivizes sustainable lending practices and borrower satisfaction rather than speculative activity that characterizes many blockchain projects. Long-term success requires maintaining loan quality and borrower payment performance rather than token price manipulation.

Performance and Adoption Metrics

Figure Technologies has demonstrated strong operational performance since pivoting to its blockchain-based platform, though verifying claimed metrics remains challenging due to conflicting data sources. The company reported $190.6 million in revenue for the first six months of 2025, representing 22% year-over-year growth from $156 million in the comparable prior period.

Annual revenue reached $341 million in 2024, marking 58% growth compared to 2023 performance. Figure achieved profitability with $29.1 million in net income during the first half of 2025, reversing a $15.6 million loss in the prior year period. This turnaround reflects both revenue growth and operational efficiency improvements through blockchain automation.

Home Equity Lending Volume

Figure originated approximately $6 billion in home equity loans during the 12 months ended June 30, 2025, representing 29% year-over-year growth. The company claims position as the largest non-bank HELOC lender in the United States, though this market share calculation excludes major banks that suspended HELOC offerings during the COVID-19 pandemic.

Processing speed represents a key competitive advantage, with median funding time of 10 days compared to the 42-day industry average as of 2025. Application completion requires approximately five minutes through Figure's digital platform, while traditional bank applications often require hours of paperwork and multiple appointments. This efficiency stems from AI-powered underwriting and blockchain-based document verification.

Figure maintains partnerships with 170+ institutions that use its loan origination system, including mortgage brokers, credit unions, and community banks. Partner-originated volume represents a substantial portion of total lending activity, though Figure has not disclosed specific partner contribution percentages.

Institutional Investor Adoption

Figure Connect marketplace has attracted 27 institutional participants since its June 2024 launch, generating $1.3 billion in HELOC trading volume during its first 12 months of operation. Marketplace revenue reached $45 million in the first half of 2025 compared to just $200,000 in the prior year, representing massive growth in institutional adoption.

Institutional investor volume totaled approximately $4 billion through 16 qualified investors during the 12 months ended June 30, 2025. These investors include credit funds, asset managers, and insurance companies seeking exposure to secured consumer debt. Figure's marketplace offers attractive yields with lower operational overhead compared to traditional loan purchasing programs.

The company has completed multiple rated securitizations, including the FIGRE 2023-HE1 transaction totaling $236.8 million with AAA and A ratings from DBRS Morningstar. Securitization activities demonstrate institutional acceptance of Figure's blockchain-based loan origination and servicing capabilities.

Blockchain Transaction Metrics

Figure claims to have processed over $50 billion in blockchain transactions since 2018, positioning Provenance as one of the most active enterprise blockchain networks. Monthly settlement volume exceeds $600 million in loans processed through blockchain infrastructure as of June 2025.

However, DeFiLlama's analysis reveals significantly lower on-chain activity than Figure's claims suggest. DeFiLlama reports only $5 million in Bitcoin and $4 million in Ethereum held in verifiable smart contracts, with daily Bitcoin trading volumes as low as $2,000. The platform's YLDS stablecoin shows circulation of approximately 20 million tokens, far below levels that would support claimed transaction volumes.

This discrepancy has created controversy about whether Figure's platform represents genuine blockchain adoption or primarily traditional database operations with blockchain record-keeping overlay. DeFiLlama has accused Figure of inflating metrics by including off-chain activities in blockchain transaction totals.

Market Position and Growth Trajectory

Figure's market position benefits from major banks' continued reluctance to offer HELOCs following the COVID-19 pandemic. JPMorgan Chase and Wells Fargo suspended HELOC applications in 2020 and have not resumed full programs as of September 2025. This market exit by traditional leaders created opportunities for non-bank lenders like Figure.

The company's geographic expansion continues with licensing in 49 states and Washington, D.C. as of September 2025. New York and Delaware were the most recent additions in October 2024, completing Figure's national coverage except for Nevada. State licensing requirements create barriers to entry that protect Figure's market position.

Total loans originated exceed $17 billion since Figure's 2018 inception, with outstanding balances of $11.7 billion as of September 2025. This represents significant scale in the specialized HELOC market, though concentration in a single product creates dependency on real estate market conditions.

Risks and Criticisms

Figure Technologies faces multiple risk categories that potential investors must carefully evaluate, ranging from data transparency concerns to regulatory uncertainties and market concentration issues. The most immediate controversy involves conflicting claims about the extent of genuine blockchain activity versus traditional financial operations.

Data Integrity and Transparency Concerns

The most significant criticism centers on discrepancies between Figure's reported metrics and independent verification. DeFiLlama, a respected DeFi analytics platform, has publicly disputed Figure's claimed $12.5 billion in total value locked, finding only $45 million in verifiable on-chain assets as of September 2025.

DeFiLlama's analysis suggests Figure includes "off-chain activities" in blockchain metrics, potentially misleading investors about the platform's actual decentralization and blockchain adoption. The analytics platform claims Figure has resisted third-party audits and allegedly threatened defamation lawsuits against critics questioning reported data.

This controversy raises fundamental questions about how blockchain-based real-world asset platforms should be measured and compared. Figure's position that loan ownership recorded on-chain constitutes "blockchain activity" conflicts with DeFiLlama's methodology requiring assets to be held entirely on-chain. Without consensus measurement standards, investors face difficulty evaluating competing platforms.

The data dispute has not prevented Figure's successful IPO or continued business growth, suggesting institutional investors either accept Figure's methodology or focus primarily on traditional financial metrics rather than blockchain adoption levels. However, retail crypto investors accustomed to transparent on-chain data may find Figure's reporting inconsistent with their expectations.

Regulatory and Compliance Risks

Despite Figure's comprehensive regulatory compliance, the tokenized lending sector faces ongoing regulatory uncertainty that could impact business operations. The SEC's Project Crypto initiative and joint SEC-CFTC regulatory framework provide more clarity than previously available, but specific rules for real-world asset tokenization continue evolving.

State-level regulation adds complexity, with 49 different licensing regimes requiring ongoing compliance maintenance. Changes to mortgage regulations, electronic notarization rules, or blockchain-specific requirements could necessitate costly operational adjustments or limit Figure's geographic availability.

Consumer protection litigation represents another regulatory risk. Figure has faced lawsuits alleging "bait-and-switch" practices in HELOC marketing, though such litigation is common among consumer lenders and does not necessarily indicate systematic problems. Nevertheless, adverse judgments could damage Figure's reputation or require costly settlement payments.

The company's dependence on regulated banking partnerships for settlement and payment processing creates additional regulatory exposure. Changes to banking regulations affecting fintech partnerships could disrupt Figure's operational model or increase compliance costs.

Market Concentration and Cyclical Risks

Figure's extreme concentration in HELOC products creates significant exposure to housing market cycles and interest rate volatility. HELOCs represented 99% of originations during the first half of 2025, leaving little diversification if real estate markets experience significant corrections.

Rising interest rates present dual challenges by reducing refinancing activity that drives HELOC demand while increasing Figure's funding costs. The company's recent shift toward marketplace-based revenue provides some insulation from origination volume fluctuations, but underlying HELOC performance still determines investor demand for tokenized assets.

Credit risk remains despite Figure's focus on prime borrowers with substantial home equity. Economic recessions typically increase unemployment and reduce property values, potentially leading to higher default rates even among traditionally low-risk borrowers. Figure's automated underwriting systems may not capture economic stress factors that human underwriters would identify.

Geographic concentration in certain metropolitan areas could amplify regional real estate corrections. While Figure operates nationally, certain markets likely represent disproportionate origination volumes, creating exposure to local economic conditions.

Technology and Operational Risks

Figure's dependence on blockchain infrastructure introduces technology risks uncommon among traditional lenders. The Provenance blockchain, while purpose-built for financial applications, remains relatively new technology with limited operational history under stress conditions. Network outages, security breaches, or consensus failures could disrupt Figure's core operations.

Smart contract risks include potential coding errors that could cause incorrect payment distributions or ownership transfers. While Figure has operated since 2018 without major incidents, blockchain applications face ongoing cybersecurity threats and technical challenges that traditional databases do not encounter.

Integration complexity between blockchain systems and traditional financial infrastructure creates additional failure points. Figure's hybrid model requiring coordination between on-chain ownership records and off-chain payment processing increases operational complexity compared to purely traditional or purely blockchain-based approaches.

Scalability limitations could constrain growth if transaction volumes exceed blockchain capacity. While Provenance uses efficient Proof-of-Stake consensus, processing thousands of daily loan settlements may approach network limits during peak origination periods.

Valuation and Investment Risks

Figure's post-IPO valuation metrics suggest potential overvaluation relative to traditional financial services companies. Trading multiples of 15x sales and 50-60x operating earnings exceed typical mortgage lending company valuations, raising questions about whether market expectations for growth and profitability are achievable.

Limited trading history as a public company creates price volatility risks for FIGR stockholders. The stock's 44% first-day gain demonstrates significant investor interest but also suggests potential for sharp corrections if business results disappoint expectations.

Competition from traditional banks returning to HELOC markets could pressure Figure's market share and pricing power. While major banks remain largely absent, regional banks and credit unions are expanding HELOC offerings with competitive digital platforms that may match Figure's speed advantages without blockchain complexity.

Token liquidity risks affect institutional investors holding FIGR_HELOC tokens, as the limited marketplace with only 27 participants may create difficulty exiting positions during market stress. Traditional asset-backed securities markets provide greater liquidity despite longer settlement times.

Use Cases and Market Fit

Figure's HELOC tokenization addresses genuine inefficiencies in traditional home equity lending while creating new opportunities for institutional investors seeking exposure to secured consumer debt. The platform's primary value proposition centers on eliminating costly intermediation that makes traditional HELOCs expensive and slow to process.

Borrower Benefits and Use Cases

Figure's digital-first approach provides substantial advantages for homeowners seeking to access equity. The five-minute application process eliminates multiple bank visits and extensive paperwork requirements common with traditional lenders. AI-powered underwriting enables rapid credit decisions without human intervention, reducing approval times from weeks to hours in many cases.

Cost savings represent another significant borrower benefit. Figure claims average savings of $850 per $100,000 mortgage through elimination of various intermediary fees. These savings stem from automated processing, reduced manual documentation, and direct institutional funding that bypasses traditional wholesale lending networks.

Homeowners facing time-sensitive financing needs particularly benefit from Figure's speed advantages. Real estate investors requiring quick equity access for additional property purchases, home improvement contractors needing immediate funding, or borrowers consolidating high-interest debt find Figure's 10-day median funding time superior to traditional alternatives.

The platform also serves borrowers who prefer digital interactions over branch visits. Tech-savvy homeowners comfortable with online financial services appreciate Figure's mobile-optimized application process and digital document delivery. This demographic increasingly expects fintech-style user experiences from all financial providers.

Institutional Investor Applications

Figure Connect marketplace addresses institutional demand for direct exposure to consumer credit without traditional securitization complexity. Asset managers, pension funds, and insurance companies can purchase tokenized loan pools with transparent performance data and automated payment distribution.

Real-time settlement capabilities provide significant advantages over traditional asset-backed securities markets. Institutional investors can adjust portfolio allocations immediately rather than waiting weeks or months for trade settlement. This agility becomes particularly valuable during market volatility when rapid position adjustments are necessary.

Blockchain-based ownership records eliminate reconciliation disputes common in traditional securitization markets. Multiple parties maintaining separate databases often encounter discrepancies that require costly resolution processes. Immutable blockchain records provide single sources of truth that all parties can verify independently.

Enhanced transparency appeals to institutional investors requiring detailed performance reporting for regulatory compliance. Traditional mortgage-backed securities often provide limited visibility into underlying loan characteristics and payment performance. Figure's platform offers loan-level data access that enables sophisticated risk management and portfolio optimization.

Partnership Network Integration

Figure's loan origination system serves 170+ partner institutions seeking to offer HELOC products without developing proprietary blockchain infrastructure. Community banks, credit unions, and mortgage brokers can brand Figure's technology as their own while leveraging proven operational capabilities.

Partner institutions benefit from Figure's regulatory compliance framework, including SEC registration and state licensing across 49 jurisdictions. Smaller institutions often lack resources to navigate complex regulatory requirements for new product launches. Figure's comprehensive compliance infrastructure enables rapid market entry without regulatory development costs.

Technology integration provides partners with modern digital capabilities that would require substantial internal investment to develop independently. Figure's mobile applications, AI underwriting, and blockchain settlement represent millions of dollars in development costs that partners can access through revenue-sharing arrangements.

Risk management capabilities also attract partner institutions concerned about HELOC credit exposure. Figure's automated underwriting incorporates sophisticated risk models developed through analysis of thousands of loan performances. Partners gain access to institutional-grade risk management without developing internal expertise.

Market Expansion Opportunities

Figure's blockchain infrastructure positions the company for expansion beyond HELOCs into broader consumer credit markets. The same technology that enables home equity tokenization can support personal loans, auto loans, or credit cards with minimal additional development costs.

International expansion represents another growth opportunity, particularly in markets with similar home equity lending traditions. Canada, Australia, and the United Kingdom have established HELOC markets that could benefit from Figure's digital approach. Blockchain infrastructure facilitates cross-border transactions and multi-currency support more easily than traditional systems.

B2B expansion through increased marketplace participation could substantially scale Figure's revenue without proportional cost increases. Additional institutional investors, loan originators, and service providers joining the ecosystem create network effects that benefit all participants while generating transaction fees for Figure.

Competitive Landscape

Figure operates in the intersection of traditional mortgage lending and blockchain-based financial services, creating a unique competitive position that faces challenges from both established financial institutions and crypto-native protocols. The company's market leadership in tokenized real estate lending provides advantages, but emerging competitors and traditional bank re-entry pose significant threats.

Traditional Banking Competition

Major U.S. banks largely retreated from HELOC markets following the COVID-19 pandemic, with JPMorgan Chase and Wells Fargo suspending new applications in 2020 and maintaining those restrictions through September 2025. This market exit created opportunities for non-bank lenders like Figure to capture market share without competing against institutions with massive balance sheets and established customer relationships.

However, regional banks and credit unions have expanded HELOC offerings with competitive digital platforms. Bank of America maintained its HELOC program and generated over $90 billion in volume during Q4 2024, offering rate discounts and no-fee structures that pressure Figure's pricing. Citizens Bank and PNC Bank also compete actively in markets where Figure operates.

Better.com launched a "One-Day HELOC" product promising approval within eight hours, matching Figure's speed advantages without blockchain complexity. Better's $60 million in monthly originations by late 2024 demonstrates market acceptance of digital-first approaches that don't require customers to understand cryptocurrency or blockchain technology.

SoFi offers HELOCs up to 95% of home value with aggressive promotional bonuses including $1,000 cashback offers. SoFi's deposit base provides funding advantages that Figure lacks, enabling potentially lower borrower rates. Rocket Mortgage has integrated HELOC offerings with its established mortgage platform, creating cross-selling opportunities and operational efficiencies.

Blockchain and Tokenized Asset Competitors

Within blockchain-based real estate tokenization, Figure faces competition from platforms with different technical approaches and target markets. RealT operates on Ethereum and Gnosis blockchains, focusing on fractional real estate ownership rather than debt instruments. RealT's $5 million in tokenized lending market represents much smaller scale but targets retail investors excluded from Figure's institutional focus.

Lofty.ai uses Algorand blockchain for retail-accessible real estate tokenization with $50 fixed token prices and daily rental income distribution. While Lofty focuses on property ownership rather than lending, it demonstrates alternative approaches to real estate tokenization that could expand into debt markets.

Tradable and Maple Finance represent direct competitors in tokenized lending markets. Tradable has originated $2.1 billion in loans, while Maple Finance reached $1.2 billion, though both platforms focus on unsecured credit rather than real estate-backed lending. Figure claims approximately 75% market share in tokenized private credit, but this calculation may not include all competing platforms.

HoneyBricks targets institutional investors with tokenized commercial real estate offering 8-12% returns and loans up to 60% of token value. While focused on commercial rather than residential real estate, HoneyBricks demonstrates institutional demand for blockchain-based real estate exposure beyond Figure's HELOC model.

Regulatory Compliance Advantages

Figure's comprehensive regulatory compliance creates significant competitive moats against crypto-native platforms that often operate in regulatory gray areas. Figure Securities' SEC registration as a broker-dealer with Alternative Trading System authority enables institutional trading that unregistered platforms cannot legally facilitate.

State licensing across 49 jurisdictions requires substantial compliance investment that few blockchain platforms have undertaken. Figure's 180+ lending and servicing licenses represent years of regulatory development that competitors would need to replicate to achieve similar market coverage.

FINRA supervision and SEC registration for the YLDS stablecoin provide additional regulatory certainty that appeals to institutional investors. Traditional financial institutions require regulatory clarity before engaging with blockchain platforms, giving Figure advantages over competitors operating without explicit regulatory approval.

However, regulatory compliance also creates operational constraints and costs that more agile competitors can avoid. Figure's need to maintain extensive compliance infrastructure may slow innovation or limit product development compared to platforms operating in less regulated markets.

Technology and Infrastructure Comparison

Figure's Provenance blockchain represents a purpose-built approach to financial applications, contrasting with competitors using general-purpose blockchains like Ethereum or Algorand. Provenance's Cosmos SDK foundation provides enterprise-grade performance and financial-specific features, but limits interoperability with other DeFi protocols.

Ethereum-based competitors benefit from extensive DeFi integration possibilities and established institutional infrastructure through platforms like MetaMask Institutional and Coinbase Custody. However, Ethereum's variable transaction costs and network congestion during peak periods create operational challenges for high-volume financial applications.

Figure's hybrid approach combining blockchain ownership records with traditional banking settlement provides compatibility with existing financial infrastructure. Competitors using purely blockchain-based approaches may struggle with institutional adoption due to integration complexity with traditional back-office systems.

Smart contract sophistication varies significantly among competitors. Figure's Financial NFTs incorporate complex business logic specific to mortgage lending, while simpler platforms may use basic token standards that lack necessary compliance and operational features.

Market Position and Growth Trajectories

Figure's first-mover advantage in regulated tokenized lending provides substantial market position benefits. The company's proven ability to navigate regulatory requirements and achieve institutional adoption creates barriers for competitors seeking to replicate Figure's success.

However, the tokenized real estate market's projected growth to $19.4 billion by 2033 provides opportunities for multiple successful platforms. Market expansion could accommodate several competitors without necessarily diminishing Figure's absolute growth, though relative market share may decline as competition intensifies.

Traditional banks' potential re-entry into HELOC markets represents the most significant competitive threat. Major banks possess advantages in funding costs, customer acquisition, and operational scale that could pressure Figure's market position if they choose to prioritize HELOC products again.

Network effects from Figure Connect marketplace create switching costs for institutional participants, but these effects remain limited with only 27 participants as of June 2025. Larger marketplaces with more participants could provide superior liquidity and price discovery, potentially attracting institutional investors away from Figure's platform.

Regulatory and Legal Outlook

Figure Technologies operates within a rapidly evolving regulatory environment that has become increasingly favorable for blockchain-based financial services during 2025. The company's proactive approach to regulatory compliance positions it well for continued regulatory developments, though ongoing legal uncertainties require careful monitoring.

Current Regulatory Framework

The SEC's launch of Project Crypto in early 2025 created a structured approach to digital asset regulation that benefits compliant platforms like Figure. Chair Paul Atkins' comprehensive framework provides clear guidance for tokenized real-world assets, reducing regulatory uncertainty that previously hindered institutional adoption.

Joint SEC-CFTC coordination through the September 2, 2025 statement on spot crypto asset trading venues clarified jurisdiction boundaries that had created compliance challenges. Figure's SEC registration as a broker-dealer with ATS authority positions the company advantageously under the new framework, while competitors operating without explicit approval face greater uncertainty.

The establishment of crypto task forces by both agencies signals continued regulatory development rather than enforcement-focused approaches that characterized previous administrations. This shift toward rules-based regulation rather than enforcement actions creates a more predictable environment for Figure's continued operations and expansion.

State-level regulation has also evolved favorably, with electronic notarization rules expanding during the COVID-19 pandemic and remaining in place through 2025. Figure's digital-first approach benefits from relaxed requirements that enable remote closings and electronic document execution.

HELOC-Specific Regulatory Environment

Consumer protection regulations specific to home equity lending have remained stable, with Truth in Lending Act and Real Estate Settlement Procedures Act requirements providing clear compliance frameworks. Figure's automated systems incorporate these regulatory requirements directly into loan origination workflows, reducing compliance risk compared to manual processes.

The Consumer Financial Protection Bureau has focused enforcement attention on traditional banks rather than non-bank lenders like Figure, though this could change as Figure's market share grows. The company's comprehensive state licensing and federal registration provide protective frameworks against potential CFPB enforcement actions.

Qualified Mortgage rules exempt HELOCs from certain requirements that apply to traditional mortgages, providing operational flexibility that Figure leverages through its streamlined underwriting processes. This regulatory structure enables Figure's speed advantages while maintaining consumer protections.

State licensing requirements create barriers to entry that protect Figure's market position while requiring ongoing compliance maintenance. Changes to licensing requirements in major markets like California or New York could impact operations, but Figure's established relationships with state regulators provide early warning of potential changes.

Future Regulatory Developments

The CLARITY Act proposed in Congress would establish clearer SEC-CFTC jurisdiction boundaries and could provide additional regulatory certainty for tokenized asset platforms. If enacted, this legislation would benefit Figure's business model by reducing compliance uncertainty and enabling expansion into new product categories.

Potential SEC innovation sandboxes could provide exemptions for compliant blockchain applications, enabling Figure to test new products or services without full regulatory approval processes. The company's established regulatory relationships position it well to participate in such programs if they become available.

International regulatory coordination is developing through organizations like the Financial Stability Board and Bank for International Settlements. Harmonized regulations could facilitate Figure's potential international expansion while reducing compliance costs for cross-border operations.

Central Bank Digital Currency developments by the Federal Reserve could impact Figure's blockchain infrastructure and settlement processes. While CBDC implementation remains years away, Figure's Provenance blockchain could potentially integrate with government-issued digital currencies to provide seamless settlement capabilities.

Compliance Advantages and Risks

Figure's comprehensive regulatory compliance creates significant competitive advantages but also imposes costs and constraints that more agile competitors can avoid. The company's approach provides institutional comfort while limiting operational flexibility compared to platforms operating in regulatory gray areas.

Ongoing compliance costs include regulatory reporting, audit requirements, and legal reviews that competitors may not face. These expenses represent ongoing operational overhead but also create barriers to entry that protect Figure's market position.

Regulatory changes could require costly system modifications or operational adjustments. Figure's blockchain infrastructure provides some flexibility through smart contract updates, but major regulatory changes could necessitate substantial redevelopment costs.

The company's public status adds Securities and Exchange Commission reporting requirements and public company governance obligations that increase compliance complexity. However, public markets also provide capital access and institutional credibility that private competitors lack.

Future regulatory enforcement could focus on data transparency issues raised by critics like DeFiLlama. Figure's ability to demonstrate genuine blockchain adoption versus traditional database operations with blockchain overlays may become increasingly important as regulators develop more sophisticated understanding of tokenized asset platforms.

Outlook and Scenarios

Figure Technologies enters 2026 with strong momentum from its successful IPO and growing marketplace business, positioned to benefit from favorable regulatory developments and expanding institutional adoption of tokenized assets. However, the company faces several critical scenarios that could significantly impact its trajectory over the next three to five years.

Base Case Scenario

The most likely scenario involves continued steady growth in Figure's core HELOC business complemented by expansion of the Figure Connect marketplace. Assuming stable housing markets and moderate interest rate environments, Figure could realistically achieve $600-800 million in annual revenue by 2027, representing 75-135% growth from 2024 levels.

Marketplace revenue should continue scaling as institutional adoption increases. With 27 current participants potentially expanding to 50-75 institutions by 2027, marketplace transaction volume could reach $5-8 billion annually. This growth would generate $50-100 million in marketplace fees at current pricing structures.

Geographic expansion into international markets represents another growth catalyst, particularly in Canada and Australia where home equity lending markets exist with similar regulatory structures. International expansion could add 20-30% to origination volumes while leveraging existing technology infrastructure with minimal additional development costs.

Product diversification beyond HELOCs into personal loans, auto loans, and other consumer credit categories could substantially expand addressable markets. Figure's blockchain infrastructure and regulatory compliance framework provide foundations for rapid expansion into adjacent products with attractive unit economics.

Optimistic Scenario

An optimistic scenario assumes accelerated institutional adoption driven by superior performance data and regulatory clarity. If tokenized real estate markets achieve projected growth rates approaching $19.4 billion by 2033, Figure's market leadership could generate revenues exceeding $1 billion annually within five years.

Major bank partnerships could dramatically scale Figure's origination volumes. If traditional banks partner with Figure rather than developing competing blockchain capabilities internally, origination volumes could increase 5-10x current levels. Partnership structures would likely involve revenue sharing but could provide access to bank funding costs and customer acquisition capabilities.

Blockchain infrastructure licensing to other financial institutions represents significant optionality. Figure's Provenance blockchain and compliance framework could become industry standards licensed to banks, credit unions, and fintech companies seeking blockchain capabilities without internal development costs.

International expansion accelerating through regulatory harmonization and cross-border blockchain capabilities could create global market opportunities. European and Asian markets for real estate-backed lending exceed U.S. market sizes and could provide substantial growth if Figure successfully navigates international regulatory requirements.

Pessimistic Scenario

Downside scenarios center on competitive pressure from traditional banks re-entering HELOC markets with competitive digital offerings. If major banks resume aggressive HELOC marketing with superior funding costs and established customer relationships, Figure's growth could stagnate or decline.

Real estate market corrections could significantly impact Figure's business model. Housing price declines would reduce available equity for HELOC borrowing while potentially increasing default rates on existing loans. Economic recessions typically reduce consumer confidence in borrowing against home equity, limiting origination volumes.

Regulatory backlash against tokenized assets could constrain Figure's marketplace business or require costly compliance modifications. If regulators determine that current tokenization approaches inadequately protect investors or consumers, new requirements could substantially increase operational costs.

Technology disruption from alternative approaches to digital lending could reduce Figure's competitive advantages. If traditional banks successfully implement comparable digital capabilities without blockchain complexity, Figure's speed and cost advantages could diminish while retaining blockchain infrastructure costs.

Data transparency controversies could escalate if third-party analysts continue challenging Figure's reported metrics. Loss of institutional confidence in Figure's blockchain adoption claims could impact marketplace participation and investor demand for tokenized assets.

Key Variables and Inflection Points

Interest rate trajectories will significantly influence Figure's business trajectory. Rising rates reduce HELOC demand while increasing Figure's funding costs, though they also increase yields for institutional investors purchasing tokenized assets. Rate environments between 4-6% likely optimize Figure's business model.

Traditional bank HELOC strategy represents the most critical competitive variable. Banks' decisions to resume, expand, or continue avoiding HELOC markets will determine competitive intensity and Figure's market share sustainability.

Regulatory clarity development affects institutional adoption rates and Figure's expansion capabilities. Clear, favorable regulations accelerate institutional participation, while uncertainty or adverse changes could constrain growth.

Blockchain adoption by traditional financial institutions could either validate Figure's approach or create competitive threats. Industry-wide blockchain adoption would benefit Figure's first-mover positioning, while continued skepticism could limit market expansion.

Real estate market conditions influence both supply and demand for HELOCs. Moderate appreciation rates with stable employment conditions optimize Figure's business environment, while volatile housing markets create operational and credit challenges.

Conclusion

Figure HELOC (FIGR_HELOC) represents a compelling but complex intersection of traditional mortgage lending and blockchain innovation. The platform has achieved genuine scale with $11.7 billion in outstanding tokenized loans and successful NASDAQ IPO, demonstrating institutional acceptance of blockchain-based real-world asset tokenization.

However, significant data transparency disputes and valuation concerns require careful investor consideration. While Figure Technologies shows strong traditional financial metrics with $341 million in 2024 revenue and achieved profitability, conflicting claims about on-chain activity levels create uncertainty about the platform's true blockchain adoption versus traditional operations with blockchain record-keeping overlays.

The regulatory environment has evolved favorably for compliant platforms like Figure, with comprehensive SEC and FINRA approvals providing competitive advantages over crypto-native alternatives. Yet market concentration in HELOC products creates cyclical risks, while premium valuations following the September 2025 IPO suggest elevated investor expectations that may be challenging to sustain.

Figure's technical achievements in processing $50 billion in blockchain transactions since 2018 and creating institutional marketplace infrastructure represent genuine innovations in financial services. The platform's ability to reduce loan processing costs by 93% and compress approval times to 10 days provides clear borrower benefits while generating attractive institutional investment opportunities.

Ultimately, FIGR_HELOC's investment merits depend heavily on investors' perspectives regarding blockchain adoption in traditional finance and tolerance for data transparency controversies. The platform offers exposure to tokenized real estate lending through a regulated, operationally successful company, but requires careful evaluation of competing claims about the extent of genuine blockchain integration versus traditional financial services with distributed ledger overlays.