Figure Offers Companies Way to List Equity on Blockchain
Blockchain-based lender Figure has launched a way for companies to list their equity native on blockchain.
The company said its On-chain Public Equity Network (OPEN), announced Wednesday (Jan. 14), differs from other tokenization efforts in that OPEN equities are blockchain registered, and not a tokenized version of Depository Trust and Clearing Corporation (DTCC) securities.
“OPEN reinvents equity trading,” Mike Cagney, Figure’s executive chairman, said in a news release. “The significant benefits over the centralized incumbent model incent companies to use OPEN and their investors to demand it. After originating over $20 billion in on-chain credit, we’re now excited to bring public equity to Provenance Blockchain.”
According to the release, the equities will trade on a limit order book using Figure’s Alternative Trading System (ATS), allowing for continuous trading. Shareholders will be able to use Figure’s Democratized Prime, a decentralized finance (DeFi) protocol to borrow against and lend out their stock, “disintermediating the role prime brokers traditionally play,” the company added.
Figure said it plans to be the first issuer to use OPEN, having filed a public registration statement in November for a non-dilutive, secondary equity offering using the network. The company added that market makers like Jump Trading are preparing to join the blockchain, while BitGo has agreed to offer qualified custodial services to eligible OPEN shareholders.
“We’re seeing growing momentum across the industry toward more transparent, blockchain-native market structures,” said Mike Belshe, BitGo’s co-founder and CEO. “Figure’s OPEN on-chain offerings represent the next evolution of digital asset markets, and BitGo is proud to support the infrastructure that enables them to operate securely and at scale.”
PYMNTS spoke last year with Todd Stevens, Figure’s chief capital officer, following the company’s initial public offering (IPO).
The positive reaction to the listing, he said, “tells us that investors are very interested in this possibly being a pivotal moment around companies adopting these types of technologies and really driving toward the future of capital markets … and how assets travel from buyer to seller.”
That future, Stevens added, includes Figure’s blockchain-centered approach to lending and asset settlement.
“All we’re saying is our preferred method — and we think the market’s coming along with this — is to do this across a blockchain rail,” he said.
The technology, he told PYMNTS, allows for efficiencies that legacy mortgage and loan markets struggle to match.
“You don’t have to have T+1, T+2 settlements anymore. You can have atomic settlement. You don’t have to pass around spreadsheets to reconcile trades,” he said.
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