Figure's IPO plan reveals new opportunities in the RWA sector

Recently, Figure, a blockchain financial company founded by a former co-founder of SoFi, announced that it has submitted its initial public offering (IPO) application to the U.S. Securities and Exchange Commission (SEC) and plans to complete its listing within the year. This move not only validates the success of Figure's business model but also marks the transition of the real-world assets (RWA) sector from concept to reality, signaling the commencement of a reconstruction war in a trillion-dollar market.

Figure dominates the RWA private credit tokenization space with absolute authority. Data shows that in the $27.74 billion tokenized private credit market, Figure's cumulative loan size has reached $11 billion, accounting for nearly 50% of the market share, making it a leading player in the industry.

The background of founder Mike Cagney is a key factor in the rise of Figure. As a veteran in the consumer finance sector, Cagney keenly recognized the transformative potential of blockchain technology in financial infrastructure and founded Figure in 2018, proposing the grand vision of "reshaping the credit market with blockchain."

Figure has built a complete ecosystem from asset issuance, loan initiation to securitization and trading:

• The self-developed ProvenanceBlockchain has become the first public chain in the industry specifically designed for financial services, supporting real-time asset settlement and composability.
• The "Connect platform" launched connects loan initiators with investors, achieving efficient matching and circulation of assets.
• The recently launched YLDS stablecoin has become the world's first income-generating stablecoin registered with the US SEC, introducing a mainstream compliant income vehicle for on-chain assets.

These innovations constitute Figure's strong product advantages, enabling it to expand against the trend in the cryptocurrency market. In just the past month, its new loan assets have exceeded 800 million dollars, with astonishing growth.

The success of Figure aligns with the overall explosive trend of the RWA sector. Recently, RWA-related crypto assets have risen by 6.9% overall, with significant increases in mainstream tokens such as Provenance Blockchain, Stellar, and Injective, reflecting investors' growing preference for "hard assets" linked to the real economy in uncertain environments.

The RWA market has enormous potential. The private credit market has reached a scale of $30 trillion, and according to forecasts from professional institutions, the potential tokenization space of the entire RWA market could reach $31 trillion, covering multiple traditional financial asset categories such as US dollars, US Treasuries, gold, real estate, and accounts receivable.

Many Wall Street giants have entered the scene: a large asset management company has launched the first tokenized fund, another well-known investment management company has deployed a money market fund on a public blockchain, and top private equity firms are using tokenization tools to lower investment thresholds, gradually "democratizing" traditional high-net-worth products.

Figure is democratizing asset classes that were previously only accessible to institutions and the wealthy through its platform, and is innovating the fusion of "on-chain asset management and consumer finance."

Despite Figure being in a leading position, the widespread adoption of RWA still faces three key challenges:

1. "Trust Anchor" of On-chain Assets and Off-chain Entities: How to ensure that tokens truly represent real-world assets and have clear legal ownership?
2. Asset structuring is a prerequisite for tokenization: not all assets can be directly "on-chain". A more feasible approach is to first structure them through traditional financial mechanisms and then tokenize them to improve efficiency and compliance.
3. The value of RWA lies in efficiency improvement: the role of blockchain is not to "create" new financial products, but to allow existing assets to circulate under a more transparent and real-time technological framework.

Figure has advantages in these three aspects: it understands traditional finance, masters underlying blockchain technology, and possesses multiple advantages in technical capability, compliance experience, and product implementation.

The IPO that Figure is attempting this time is a landmark event marking the transition of RWA from concept to reality, proving that blockchain can effectively empower the circulation of traditional assets, lower barriers, and enhance efficiency. Figure is trying to build a "bridge of trust" between traditional finance and the crypto world, which not only concerns the vision of an entrepreneur but may also reshape our understanding of capital markets, asset allocation, and financial democratization.

In the next ten years, whoever can master RWA will have the opportunity to control the entrance ticket to the next trillion-dollar financial new era.