Figure Technology Solutions, Inc. (Nasdaq: FIGR) is moving forward with plans to broaden its shareholder base and bolster its financial position through a secondary public offering of up to 4.23 million shares of its Series A Blockchain Common Stock, the company announced .
The offering comes as Figure continues to pioneer the use of blockchain technology within capital markets, aiming to streamline processes and reduce risk. The company describes itself as a blockchain-native capital marketplace for the origination, funding, sale and trading of tokenized assets. Figure initially filed a registration statement with the Securities and Exchange Commission (SEC) regarding the proposed offering in .
Notably, Figure intends to simultaneously repurchase up to $30 million of its Class A common stock, funded by existing cash reserves. This dual move suggests a strategic effort to optimize its capital structure and potentially increase the value of remaining shares. The repurchase is contingent on the completion of the secondary offering and will be executed at a price per share equivalent to that paid by underwriters to selling stockholders.
Blockchain-Native Equity and the OPEN Network
The Series A Blockchain Common Stock is designed to operate within a fully blockchain-based ecosystem. According to the company, the stock will be issued on the Provenance Blockchain, traded on Figure’s alternative trading system (ATS), and settled directly into self-custody user wallets. This represents a significant departure from traditional securities infrastructure, which relies on intermediaries like clearinghouses and custodians.
Figure’s executive chairman and co-founder, Mike Cagney, articulated the ambition behind this approach in , stating, “This is a new capital markets infrastructure moment for efficiency and risk management — a huge leap forward from the legacy securities market infrastructure, and the start of a world that no longer needs it.”
The company is also developing its On-chain Public Equity Network (OPEN), launched in , which allows companies to list their equity directly on the blockchain. Figure plans to be the first issuer to utilize OPEN, having filed the necessary registration statement with the SEC in . Cagney described OPEN as a reinvention of equity trading, highlighting the potential benefits for companies and investors alike.
Strong Growth in Loan Marketplace Volume
The announcement of the secondary offering and stock repurchase coincided with the release of Figure’s preliminary fourth-quarter and full-year financial results. The company reported a substantial increase in its consumer loan marketplace volume, rising 131% year-over-year to $2.7 billion in the fourth quarter. For the full year, volume grew 63% year-over-year, reaching $8.4 billion.
CEO Mike Tannenbaum characterized the results as evidence of “the meaningful progress we’ve already made in modernizing capital markets and position us to further accelerate that transformation.” The growth in loan volume suggests increasing adoption of Figure’s platform and its underlying blockchain technology.
Implications for Capital Markets
Figure’s efforts to tokenize equity and build a blockchain-based capital marketplace represent a potentially disruptive force in the financial industry. Traditional securities trading is often characterized by complex processes, high costs, and limited transparency. Blockchain technology offers the potential to address these challenges by automating processes, reducing the need for intermediaries, and providing greater visibility into transactions.
However, the widespread adoption of blockchain-based securities faces several hurdles. Regulatory uncertainty remains a significant concern, as policymakers grapple with how to apply existing rules to this new technology. Scalability and security are also important considerations, as blockchain networks must be able to handle a large volume of transactions without compromising data integrity.
The success of Figure’s secondary offering and the continued development of its OPEN network will be closely watched by industry participants. The company’s ability to attract investors and demonstrate the benefits of its blockchain-based platform could pave the way for broader adoption of this technology within capital markets. Goldman Sachs & Co. LLC, Morgan Stanley and Cantor will act as lead joint book-running managers and sales agents for the proposed offering. Preliminary prospectuses are available through the firms listed in the company’s press release.
