In a recent exchange on X, Mike Cagney, co-founder and executive chairman of Figure Technologies (Nasdaq: FIGR), dismissed real estate as a “red herring” in the push to migrate assets onto blockchain. Responding to a query about tokenizing real-world assets (RWAs), Cagney argued thar real estate has been a red herring. Most likely assets to migrate to blockchain are ones that are liquid – and therefore can leverage DeFi. DeFi (lending) is the primary reason to do anything on blockchain, but it won’t work without liquid (or stable value) assets.”
This perspective seemingly challenges a lot of the hype around tokenizing illiquid assets like property, emphasizing instead the synergies between liquidity and decentralized finance (DeFi).Cagney’s background lends weight to his view.
A fintech veteran, he co-founded SoFi in 2011 before launching Figure in 2018 with his wife, June Ou. Figure leverages its Provenance Blockchain in order to streamline financial services, particularly home equity lines of credit (HELOCs) and capital markets operations.
The company made a significant move in 2025 with a blockbuster IPO, raising $7 billion and debuting on Nasdaq, signaling blockchain’s maturation in traditional finance.
Despite Figure’s roots in real estate-linked products, Cagney has pivoted the narrative toward broader capital markets integration, including using securities as DeFi collateral.
The context here is the booming RWA sector, where traditional assets are digitized as tokens on blockchains like Ethereum or Solana.
Proponents tout benefits like fractional ownership, faster settlement, and global accessibility.
Real estate, often cited as a prime candidate, allows investors to buy shares in properties without full ownership.
However, Cagney highlights its pitfalls: properties are inherently illiquid, with sales dragging on for months, high transaction costs, and values tied to local markets.
Tokenizing a family home in Topeka, as mentioned in the X thread, doesn’t inherently solve these issues and may not justify blockchain’s complexity.
Instead, Cagney supports the idea of liquid assets—those easily bought, sold, or traded without significant price impact. For instance, traditional stocks, bonds, commodities, or even GPUs for AI computing.
These can integrate with DeFi protocols, enabling lending, borrowing, and yield farming.
For example, tokenized U.S. Treasuries have risen in popularity, with funds like BlackRock‘s BUIDL offering stable yields on-chain.
Without liquidity or stable value, DeFi falters: collateral can’t be quickly liquidated in defaults, eroding trust and efficiency.
This viewpoint aligns with broader industry shifts.
In a 2025 keynote at Breakpoint, Cagney discussed that rebuilding finance on blockchain rails, stressing composability—where assets tend to interact across protocols.
Figure Markets, a subsidiary, exemplifies this by bringing real assets into DeFi ecosystems.
Critics might argue that so-called real estate tokenization still holds promise for fractionalization in emerging markets, but Cagney’s logic suggests starting with liquids accelerates adoption.
Ultimately (and quite understandably), Cagney’s stance urges the blockchain sector to prioritize utility over novelty.
By focusing on DeFi-compatible assets, the tech can potentially disrupt capital markets more effectively, possibly unlocking trillions in value. As Figure continues its post-IPO growth, this perspective could shape the next wave of fintech developments.