Mike Cagney has been here before, but not with blockchain.
In the early 2010s, it helped reshape consumer lending with SoFi by connecting borrowers directly to capital. Now, at Figure Technology Solutions (FIGR), he said he is trying to do something similar on a much larger scale: rebuild the infrastructure of the credit markets themselves.
The plan may be working. The figure surpassed $1 billion in monthly loan originations for the first time in March, part of a $2.9 billion first quarter that puts the company at about $12 billion in annualized volume.
Cagney, who will speak at the Consensus Miami conference next week, told CoinDesk that the goal is to build new pipelines for these markets.
“We are building a market where credit can move efficiently, without all the traditional layers,” he said.
Three levers of value
Cagney divided Figure’s model into three main advantages.
The first is the cost. Loan tokenization reduces the friction and expense of securitization, eliminating middlemen who have historically charged significant fees.
The second is liquidity. Figure has built what it describes as one of the only continuously updating consumer credit markets outside of government-backed mortgage systems like Fannie Mae and Freddie Mac.
“Loans are updated in real time, which creates a different type of market,” Cagney said.
The third is access. By bringing these assets on-chain, Figure can connect them to decentralized finance (DeFi), allowing a broader range of investors to gain exposure to or borrow against them.
That’s where the model starts to blur the line between traditional finance and cryptocurrencies, Cagney said.
Figure’s latest push is toward what Cagney calls “democratized prime,” essentially opening up prime brokerage-style lending to a broader audience.
Through products like its Forge platform, loans are pooled into standardized vaults and converted into tokens that can be used as collateral in DeFi protocols. That standardization is key.
“DeFi only works if the collateral is liquid and transparent,” he said.
Figure has launched related initiatives on networks like Solana, with plans to expand to Ethereum, allowing users to invest in or borrow against tokenized credit pools.
The company is also experimenting beyond lending.
It has introduced a yield stablecoin, YLDS, backed by traditional assets like Treasuries, with roughly $600 million in balances, and is exploring tokenized stocks, issuing its own shares on-chain in a way that allows investors to lend directly.
Cagney pointed out a marked inefficiency in traditional markets. Stock loans can carry loan rates of 30% or more, while investors often receive only a fraction of that return.
“We can put that value back into the hands of the asset owner,” he said.
Pragmatic Blockchain
For all the ambition, Cagney is quick to draw boundaries.
Not everything belongs to the chain, he said. Tokenization of property itself, for example, may not be an efficient use of capital. But financial abstraction, that is, loans, securities and shares, is a different story.
That pragmatism reflects a broader criticism of the crypto industry, which he says has often pursued ideas without a clear economic basis.
“A lot of things were done just for the sake of doing it,” he said. “What matters is whether this actually improves the system.”
The growth in numbers suggests that, at least in one corner of the market, the answer may be yes. The company is profitable, scaling, and approaching $30 billion in cumulative originations. This is still small compared to traditional finance, but it is big enough to attract attention.
Cagney said he sees a lot more room to run.
“Blockchain is the most transformative technology and will reallocate more public market capitalization than any other technology,” he said. “There are entire industries that are going to disappear when it becomes ubiquitous. Someone has to do the work to get there, and that’s exactly what we’re doing.”
Read more: Private credit may be the standout use case for tokenization: Maple’s Sidney Powell
