Figure Technology Solutions (FIGR): Dual Catalysts in Asset Tokenization and Housing Market Recovery

Figure Technology Solutions

Investment Thesis

Figure Technology Solutions (ticker symbol FIGR) represents a compelling investment case. The company is operating at the intersection of traditional lending and blockchain-based capital markets infrastructure. While the company currently generates the majority of its revenue through a profitable HELOC business, the long-term growth relies heavily on successfully building the foundational marketplace infrastructure for tokenizing assets. In the Real World Asset (RWA) tokenization market, according to the company announcement in July, 2025, they hold 75% market share. At the time of this writing, according to Seeking Alpha and other sources like Zack and GuruFocus, FIGR trades at a 34.05x TTM P/E, a significant premium over traditional lenders (approx. 19x), which is more in-line with high-growth fintech peers. This valuation indicates that the market is pricing FIGR as a technology company with high growth expectations, not as a traditional lender. Given the Federal Reserve's anticipated 100 basis point rate cut in 2026, the ending of Quantitative Tightening (QT), and the current administration's friendly approach to blockchain technology, the central focus must be on how Figure can leverage its network effect and strong 91% gross margin pricing power to accelerate growth.

Business Model Analysis

Founded in 2018, Figure has constructed a revolutionary business in the classic lending industry. By operating its own blockchain-based lending business with the Figure Connect marketplace and the DART digital asset registry, the company ensures a consistent supply of digital-native assets for its blockchain-based trading platform, providing an efficient lending business than traditional players. Figure is able to approve a HELOC loan in as little as 5 minutes and funding in as few as 5 days, which is significantly faster than the traditional bank standard of 40+ days. This efficiency creates a meaningful competitive advantage in customer acquisition and B2B partnerships, where speed and networking effects are key to drive market share.

With Figure Connect registered as an SEC broker-dealer with Alternative Trading System approval, Figure has built the regulatory infrastructure to facilitate secondary trading of tokenized loan assets. Hence, the company has positioned itself as a marketplace operator and it fits well with the plan to tokenize assets from major financial institutions, like BlackRock, onto a blockchain. It's also set to benefit from friendly government policies, like the GENIUS Act. 

Competitive Positioning

Figure's moat stems from three pillars. Firstly, its regulatory infrastructure creates a high barrier to entry. The combination of 180+ state-level lending licenses and SEC broker-dealer registration would be difficult for smaller competitors to replicate. Secondly, the company benefits from first-mover advantage in real-world asset tokenization, a market that is forecasted to reach $16 trillion by 2030. Thus, they can offer instant solutions to big traditional financial institutions, saving those clients resources and time to build out infrastructure to tokenize assets. Thirdly, Figure has formed partnerships with major financial institutions like Sixth Street and New York Community Bancorp to provide both liquidity and strategic credibility not only to existing clients but also future partners.

However, the competitive landscape remains competitive and unpredictable. Blockchain adoption, particularly in the financial industry, have historically moved slower than anticipated. Furthermore, established players with massive balance sheets could be willing to build out their own infrastructures, directly skipping the need to use Figure as the middle man. The window for Figure to establish lock in platform adoption may be narrower than the market currently expects.

Therefore, effective management is crucial for success here. Figure's leadership team consists of seasoned operators within the financial sector. Given the previous experiences of Co-founder and Executive Chairman Mike Cagney, June Ou, and current CEO Michael Tannenbaum at SoFi, they are proven veterans in digitalizing financial solutions. Moreover, with a 75% market share in the RWA market and a 91% gross margin, Figure already establishes itself as a giant figure with strong pricing power.

Key Risk Factors

Valuation Risk: At 34x TTM PE, Figure trades at a premium and it's comparable to other leading fintech lenders. This pricing assumes strong execution on the platform strategy to achieve around 25-30% revenue growth. Any evidence that marketplace adoption is lagging internal projections could trigger significant multiple compression.

Concentration Risk: According to Figure's S-1 form, the HELOC business accounts for 75% of revenue. It directly ties company performance to housing market conditions and interest rate cycles. A sustained period of housing market weakness, a slower rate decline from the Federal Reserve or a delay in the tokenization of Real-World Assets (RWA) would create major risks for the company.

Execution Risk: This investment thesis highly depends on third-party adoption of Figure Connect. If banks and lenders choose to build their own solutions, to adopt competitor platforms, or to simply move slower than anticipated on blockchain integration, Figure risks being revalued as a niche specialty lender rather than an infrastructure company.

Governance Considerations: According to Figure's S-1 form,  founder Mike Cagney maintains 69.2% voting control, effectively removing public shareholders from meaningful corporate governance participation. This structure concentrates both opportunity and risk in the judgment of a single key individual.

Crypto Valuation Risk: According to Figure's S-1 form, the digital assets held by Figure and third-party custodians on behalf of Figure are mounting to 3.5B. Given the historical volatility of the digital asset market, it could affect their ability to execute transactions. 

Valuation Perspective

Warning: this is not financial advise, I am simply providing my own opinion and laying out my plan for my current Figure Technology stocks. Please do your own research before deciding to do anything.

Figure's premium multiple reflects market conviction that the company will successfully transition from lender to platform operator. To understand whether the 34x TTM PE is justified at $39,95 per share, we will examine the underlying company business landscape and its valuation. According to Figure's S-1 form, the company generated approximately $340.8 million in revenue in 2024, with HELOC originations accounting for roughly $255.6 million (75%). According to Seeking Alpha, where analysts are expecting 26.1% revenue growth.

The HELOC business stands to benefit from the Federal Reserve's anticipated 100 basis point rate cut in 2026, which is expected to increase refinance volume. According to a recent Bankrate survey, 40% of potential buyers would consider purchasing a house if the mortgage rate drops below 6%, and 37% would be comfortable entering the market when the rate is under 5%. This creates a significant tailwind for Figure to accelerate through 2026-2027, assuming housing markets recover from the three-year low of existing home sales, which currently stands at 4.06 million compared to the average of over 5 million before 2020. Notably, despite the weak housing market, Figure managed to grow over 50% on average during that period.

The 34x TTM PE is comparable with other high growth fintech companies. SoFi Technologies trades at approximately 78x Forward PE and Upstart at 27x. Figure's valuation reflects the expectation of a fintech leader while giving room for executions, unlike the near-perfect expectation at SoFi. However, this still requires the company to be successful at  growing the core HELOC business, expanding partnership with major financial institutions to leverage its network effect and demonstrating sustainable liquidity to handle massive transaction volumes.

The core of this valuation rests on future earnings growth. For our forecast, we will use the forward-looking numbers from Zacks, as TTM PE is backward-looking and not suitable for a forward-thinking growth company. The market is currently pricing the stock at a 96.58x Forward P/E, which is based on a consensus next-year EPS growth estimate of 85.37%, translating to a 1.14 PEG ratio. This extremely high forward multiple indicates that the market has already priced in the expected double tailwinds from both a housing recovery and platform adoption. Thus, my forecasting scenarios are based on whether Figure can meet, miss, or beat these very high expectations.

• Bear Case (20% chance): In this scenario, negative catalysts converge. The Federal Reserve cut slower than expected. The housing market remains weak, and platform adoption stalls as institutions delay tokenization. The crypto market also faced a correction, which would affect investor confidence in blockchain related companies. Figure fails to meet the consensus, delivering only 22% revenue growth and 50% EPS growth. This severe earnings miss would be a massive hit of confidence, and the market would revalue the stock and compress its forward P/E multiple from 96.58x down to a 50x range. Since the company failed to deliver, we would keep the 1.14 PEG ratio multiple. This implies a price target of approximately $20.68, representing a significant collapse from the current levels.

• Base Case (60% chance): For this scenario to materialize, the Federal Reserve delivers its anticipated rate cuts, and platform adoption proceeds steadily, allowing Figure to just meet its aggressive target. The company successfully delivers the 85% EPS growth that the market expects. Because this outcome is already priced in, the market holds the 96.58x Forward P/E multiple steady. For such a high growth fintech company, a 1.3 PEG is not out of touch. This implies a fair value price target of $45.39.

• Bull Case (20% chance): This scenario requires favorable alignment across all fronts.The Fed rate cuts spark a strong housing recovery, and blockchain adoption accelerates, perhaps thanks to the GENIUS Act. Figure beats expectations and posts 110% EPS growth. The market rewards this outperformance by expanding the forward multiple to 110x Forward P/E, pricing in an even faster long-term growth trajectory. With a fair PEG ratio at 1.6 for such a high growth company, this implies a price target of $63.86

  
  

The 3 cases present a probability-weighted price target of $44.142 per share ($20.68 0.20 + $45.39 0.60 + $63.86 * 0.20). This suggests the stock has a 10% upside from its trading level, with the risk/reward seems fair for a high growth fintech company.

Conclusion

Figure Technology Solutions is pursuing an ambitious strategy to reimagine private credit market infrastructure. The company has demonstrated real operational advantages in its lending business and has made meaningful progress in building regulatory-compliant blockchain trading infrastructure. The critical question is one of timing and adoption velocity: will institutional buyers embrace tokenized assets and Figure's platform quickly enough to justify its current valuation?

For investors with conviction in blockchain's inevitable integration into capital markets, Figure offers differentiated exposure with tangible near-term cash flows. For those skeptical of the timeline or Figure's competitive position, the current valuation offers limited margin of safety. This is fundamentally a high-conviction, high-risk opportunity that requires belief in both the technology thesis and management's ability to execute a complex, multi-year transformation.