Summary

• Figure Technologies' IPO signifies a major shift in the blockchain industry towards real-world applications, solving practical financial problems like home equity lending.

• Figure's success is attributed to its ability to streamline traditional financial processes, exemplified by reducing loan timelines and fostering a network effect through its marketplace model (Figure Connect) and regulatory milestones like YLDS.

• Figure’s IPO is proof that blockchain's true value lies in enhancing existing financial systems rather than replacing them entirely

Today marks a watershed moment for the blockchain industry. Figure Technologies went public, and we couldn't be more excited about what this represents for the future of finance.

The Power of Real-World Blockchain Applications

At Pantera, we've long believed that the most transformative use cases of blockchain are the ones that directly touch the real economy. Figure exemplifies this thesis perfectly. While much of the crypto world focuses on speculation and financial engineering, Figure is solving actual problems for everyday Americans who need to access the equity tied up in their homes.

The numbers speak for themselves. Figure has revolutionized home equity lending by reducing loan timelines from 30 days to just 5 days. They've facilitated more than $17 billion in loans and processed over $50 billion in public blockchain transactions. As the largest non-bank HELOC lender in the US, they're not just another crypto startup—they're a mature financial services company that happens to be powered by blockchain technology.

The Network Effect is Real

What excites me most about Figure's evolution is their transition into a marketplace model. Today, 170 third parties are originating loans through Figure Connect. This network effect is precisely what we look for in successful blockchain applications—the technology becomes the enabling layer that makes an entire ecosystem more efficient.

Their latest innovation, YLDS, represents another breakthrough: the first SEC-registered yield-bearing stablecoin that's transferable peer-to-peer. This isn't just a technical achievement; it's a regulatory milestone that paves the way for mainstream adoption.

How Blockchain Creates Value at Figure

The magic happens when Figure takes illiquid assets like loans and puts both the assets and their performance history on a shared ledger. This transparency enables better pricing, perfect information flow, and unprecedented control over asset management. It's not blockchain for blockchain's sake—it's blockchain solving real inefficiencies in traditional finance.

Blockchain Has Crossed the Chasm

Figure is proof that blockchain is being used every day in real, pragmatic ways that represent genuine upgrades to our existing financial system.

Consider the data points:

• Stablecoins are powering cross-border payments, internal treasury movements, and remittance use cases

• 10% of US-Mexico remittances now flow through crypto exchange Bitso, much of it using stablecoins

• Tokenized versions of equities and other financial products, typically reserved for the global 1%, are democratizing access worldwide

• Companies like Figure are taking outdated processes like loan origination and reducing friction and cost by using blockchain as an enablement layer

Looking Forward

Figure's IPO isn't just a win for one company—it's validation of our thesis that blockchain's greatest impact comes from improving real-world processes, not creating competitive stand alone financial systems.

As we continue backing the next generation of entrepreneurs building transformative blockchain technologies, Figure stands as proof that the most valuable crypto companies are often the ones that make the existing world work better, not the ones trying to replace it entirely.

The future of finance is being built today, one real-world application at a time. Figure's journey from startup to public company shows us exactly what that future looks like.

- Paul Veradittakit

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ABOUT ME

Hi, I’m Paul Veradittakit, a Managing Partner at Pantera Capital, one of the oldest and largest institutional investors focused on investing in blockchain companies and cryptocurrencies. I’ve been in the industry since 2014, and the firm invests in equity, early-stage token projects, and liquid cryptocurrencies on exchanges. I focus on early-stage investments and share my thoughts on what’s going on in the industry in this weekly newsletter.

If you have any projects that need funding, feel free to DM me on twitter.