Mike Cagney, Co-founder and current Executive Chairman of Figure (NASDAQ:FIGR), which aims to transform capital markets by leveraging blockchain technology, predicts that the era of megabank stablecoin is coming.
Cagney noted that the GENIUS Act will usher in JP Coin, and it will “suck the liabilities (deposits) out of regional banks.”
According to Cagney, just as Chase has won in credit card rewards, JP Coin will likely offer “comparable rewards and benefits.”
He added that it is hard to see “how regionals can fight back – but they can.”
Cagney also stated that regional banks can partner with Figure “to use $YLDS as a defensive measure to stablecoin competition.”
$YLDS is an SEC-registered, yielding stablecoin.
Cagney pointed out that as a security, it’s “not part of the GENIUS Act, but it holds the same assets – treasuries and bank deposits.”
He further noted that banks can “use $YLDS as an interest-bearing alternative to other stablecoins – a huge competitive differentiation.”
Cagney explained that they can “hold their customers’ $YLDS balances as deposits, keeping their liabilities.”
And they can cooperate to “build their own payment network (like we started with USDF before the regulators killed it in 2023).”
As covered, Figure says that is focused on enhancing capital markets through blockchain / DLT.
Figure Lending LLC claims that it is the largest non-bank provider of home equity lines of credit; its software has reportedly “been used to originate more than $18B for 200k+ homeowners.”
Figure’s technology is said to be embedded across “a broad network of loan originators and capital markets buyers, and is used directly by homeowners in 49 states and Washington, DC.”
As reported in August, Michael Tannenbaum, CEO of Figure Technologies, argues that blockchain technology, not outdated federal interventions, holds the key to transforming mortgage markets for the better.
In a statement on Figure’s official site, Tannenbaum outlined a vision for a transparent, rules-based framework for tokenized credit that could expand lending opportunities, reduce costs, and enhance consumer safeguards.
This perspective challenges the status quo, suggesting that DLT / blockchain’s decentralized and immutable nature can address inefficiencies and risks in the housing finance system more effectively than traditional federal backstops like Fannie Mae and Freddie Mac.