Figure Technology Targets $2T Lending Market With Blockchain, AI  

Based in 2018, Determine began in dwelling fairness lending however has since constructed what it says is a vertically built-in mannequin that ties collectively origination, market distribution, and capital markets execution. Its recently filed S-1 lays out how the corporate is in search of to increase from dwelling fairness loans right into a wider vary of credit score merchandise, whereas additionally creating marketplaces for digital property and stablecoins. Administration argues that the mix of AI-driven automation and blockchain’s transparency may minimize inefficiencies out of lending markets and ship sooner, extra accessible credit score.

Fragmented Panorama

“The infrastructure supporting capital markets immediately is fragmented and operates on legacy programs which make use of antiquated processes for mortgage approvals and transaction processing. This creates course of and value inefficiencies in serving shopper credit score markets and limits the event of different marketplaces,” based on the submitting. “Moreover, the handbook components underpinning the data of possession and switch of economic and actual property constrain liquidity, preserve elevated prices, and are error-prone.”

The corporate’s platform is constructed on the Provenance blockchain, which it describes as a “document of reality” for property. Each mortgage originated by its system is recorded on the blockchain, offering an immutable document of possession and efficiency. Determine combines that with automated valuation fashions, AI-powered underwriting, and sensible contracts that govern mortgage gross sales and transfers. This strategy has allowed the corporate to shorten approval occasions for dwelling fairness traces of credit score (HELOCs) to a median of 10 days from an business common of 42 days. Mortgage functions might be accomplished in 5 minutes, with funding obtainable in as little as 5 days.

Determine estimates its addressable market throughout lending and capital markets at roughly $185 billion in annual income potential, primarily based on shopper credit score originations and market buying and selling. Along with lending, administration is focusing on tokenization and stablecoins as development alternatives. Exterior forecasts cited within the submitting estimate the asset tokenization market may attain $16 trillion by 2030, whereas the stablecoin market may strategy $5 trillion over the identical interval.

The submitting contends that the corporate has achieved profitability and scaled it in a capital-efficient manner. Income fashions are constructed on charges from originations, servicing, achieve on mortgage gross sales, and know-how utilization. Associate-branded lending, the place banks and mortgage originators use Determine’s platform beneath their very own model, accounts for 77% of whole originations. Determine had 168 lively companions as of mid-2025.

The corporate has additionally constructed regulatory infrastructure to assist its ambitions. It holds greater than 180 lending and servicing licenses, 48 cash transmitter licenses, and SEC registration as a broker-dealer with authority to function another buying and selling system. Internationally, it has crypto licenses within the Cayman Islands and Eire. Administration argues that this licensing framework differentiates it from rivals and can assist scaling of recent merchandise.

From the submitting:

• House Fairness Lending Progress: For the 12 months ending June 30, 2025, Determine facilitated about $6 billion in HELOC lending, up 29% from the prior 12 months. The corporate’s HELOC enterprise has grown at a compound annual development price of 70% since mid-2021.
• Determine Join Market: Launched in June 2024, {the marketplace} processed $1.3 billion in mortgage quantity in its first 12 months. The platform connects originators and traders instantly, with 27 contributors onboarded by mid-2025.
• Income and Profitability: For the six months ending June 30, 2025, internet income was $191 million, up from $156 million within the year-earlier interval. Internet earnings got here in at $29 million, in contrast with a $13 million loss a 12 months earlier than. Adjusted EBITDA, a tough measure of money circulate, reached $83 million, greater than double the prior 12 months.
• Diversifying Merchandise: Though HELOCs make up 99% of present originations, Determine is piloting debt service protection ratio loans, digital asset-backed loans, and plans to transfer into private, auto and scholar loans.
• IPO Proceeds and Enlargement: The corporate plans to make use of IPO proceeds to spend money on new product improvement, increase its mortgage market, and scale initiatives corresponding to Democratized Prime, a funding market, Determine Trade, a regulated buying and selling platform, and YLDS, a yield-bearing stablecoin registered with the SEC.

Challenges and Dangers

The submitting acknowledges dangers that would gradual adoption. Reliance on AI for credit score selections raises truthful lending compliance issues beneath federal and state regulation. Whereas automation reduces errors, regulators are carefully monitoring how algorithm-driven underwriting impacts debtors throughout credit score tiers.

Blockchain adoption additionally faces headwinds. Regardless of robust development in tokenization, lower than 1% of real-world property are at the moment recorded on blockchains, based on business information cited within the submitting. Determine’s enlargement into merchandise corresponding to Democratized Prime and YLDS stablecoin has but to supply significant income.

And although the $2 trillion determine famous above spans a broad vary of shopper asset courses, together with HELOCs, mortgage refinance, private, bank card and car loans, dwelling fairness lending stays the corporate’s core enterprise, and demand is cyclical, tied to housing markets and rates of interest. A slowdown in mortgage exercise or rising shopper credit score prices may impression origination volumes and income development.