Figure Technology Solutions secured a $200 million investment from Sixth Street, to invest over $2 billion in the non-agency mortgage market. They formed a $200 million joint venture, funded by Sixth Street's Asset Based Finance platform, to provide sustainable liquidity for Figure's private credit loans and stabilize market liquidity fluctuations.

The joint venture will provide consistent liquidity to Figure marketplace participants by serving as an "always-on," programmatic bid for Figure assets.

Todd Stevens, Chief Capital Officer at Figure, stated that this partnership aims to lower costs for lenders and borrowers, similar to the impact of TBAs in the agency mortgage space.

The venture plans to securitize Figure loans, forward-sell bonds to investors, and purchase loans from originators, starting with Figure HELOCs and expanding to other non-agency credit assets.

Michael Dryden, Partner and Head of Asset Based Finance at Sixth Street, expressed excitement about partnering in the Figure Connect marketplace milestone, supporting growth for loan originators and investors. This investment enhances Sixth Street's fintech presence, following their $4 billion backing of Affirm in December 2024.

Founded in 2018 by former SoFi CEO Mike Cagney, Figure has quickly become a key player in alternative lending. The company offers automated home improvement, business, and debt consolidation loans, and allows cryptocurrency investors to use digital assets as loan collateral. Serving over 100,000 households in 47 states, Figure stands out for its use of blockchain technology to boost efficiency and transparency.

Its subsidiary, Figure Lending LLC, is the largest non-bank provider of home equity lines of credit, facilitating over $13 billion in originations. Figure's platform is integrated with 135+ partners, including major mortgage providers. Launched in June 2024, Figure Connect, a marketplace for private credit loans, processed over 40% of Figure's transaction volume by December 2024, offering partners benefits like warehouse lines, risk management, and automated loan sales on a transparent blockchain.

Figure's lending infrastructure uses the Provenance Blockchain to onboard loans and is the largest originator of real-world assets. This blockchain technology streamlines the lending process, enabling HELOC approvals in five minutes and funding in five days. Benefits include enhanced trust through transparent, immutable records, automated smart contracts that cut costs and errors, and a decentralized structure that could democratize lending by eliminating intermediaries.

The investment in Figure comes amid positive projections for blockchain venture funding in 2025. PitchBook expects venture capital investments in blockchain and cryptocurrency to reach $18 billion, up from $13.6 billion in 2024. Galaxy Research suggests blockchain venture deals could rise by 50% year-over-year. This growth persists despite an uncertain macroeconomic backdrop with tariff threats and inflation.

The investment in Figure was announced during a short-term crypto market downturn following President Trump's trade tariffs. Positive catalysts include a pro-crypto Trump administration and potential lower interest rates in late 2025.

Jeffrey Hu of HashKey Capital noted a focus on consumer-oriented blockchain applications, highlighting decentralized physical infrastructure networks (DePINs) and real-world assets as promising areas, where Figure is building expertise.

In March 2024, Figure Technology restructured by spinning off its lending division to form Figure Technology Solutions. This change seems to have set the stage for significant investment and growth.

Figure Technology shares a similar name with Figure Markets, a digital asset exchange approved to launch a yield-bearing US dollar stablecoin. This distinction underscores Figure's expanding ecosystem in traditional finance and blockchain applications. As blockchain technology matures, Figure's strategy of combining conventional lending with crypto-backed options positions it well for future growth.

Regulatory Environment for Blockchain Loans

The blockchain mortgage ecosystem operates under evolving frameworks:

• Federal Policy Shifts: A January 2025 executive order reversed prior crypto regulations, establishing a working group to create a federal framework for digital assets. This prioritizes open blockchain networks but delays CBDC development.

• Compliance Requirements: Lenders using blockchain must navigate CFTC/NFA registration for leveraged transactions and adhere to state-level "regulatory sandboxes" (e.g., Arizona, Wyoming) that permit limited testing of fintech innovations.

• Risk of Enforcement: Recent SEC actions against crypto lenders like BlockFi ($100M penalty in 2023) underscore the need for transparent disclosures about collateral management and default risks.

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