Sixth Street, a private equity firm with over $100 billion in assets under management, has backed blockchain-based lending platform Figure Technology Solutions with a $200 million investment.
Figure and Sixth Street revealed the investment in a press release on Feb. 27. The two firms have formed a joint venture in which Sixth Street’s Asset-Based Finance division will invest $200 million in equity into Figure. The funding will strengthen Figure Connect, the platform’s private credit lending division, by enhancing its loan origination capabilities.
According to Sixth Street, the joint venture will inject over $2 billion of liquidity into the non-agency mortgage market through Figure. Meanwhile, Figure Technology will leverage this investment to scale its operations.
“This joint venture between Figure and Sixth Street puts Figure Connect on a trajectory that is ultimately intended to lower costs for lenders and borrowers, similar to how borrowing costs were lowered with the introduction of TBAs in the agency mortgage space. It validates Figure Connect as the largest, most liquid, blockchain-based capital market,” Todd Stevens, chief capital officer at Figure, said.
Launched in June 2024, the Figure Connect platform utilizes blockchain technology to offer benefits such as market risk hedging and sales automation. The Figure Connect network operates on the Provenance Blockchain, which Figure uses to onboard all loans.
As a leading originator of real-world assets, the Provenance Blockchain enables Figure’s partners to access price discovery through on-chain loan pool bidding. In December 2023, over 40% of Figure’s transaction volume occurred on the blockchain.
Through its partnership with Sixth Street, Figure will tap into additional liquidity and gain access to an “always-on” programmatic bid for its assets.
The joint venture will provide liquidity to Figure’s users, with Figure’s loans set for securitization through this collaboration.
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