Figure, the lending and blockchain firm, is rolling out crypto-as-collateral services. The move lets borrowers tap into their digital asset holdings to secure credit, without needing to liquidate their positions. It's a step toward making crypto assets viable for mainstream credit access.
How the collateral model works
Instead of selling bitcoin or ether to raise cash, users pledge those assets as collateral. Figure handles valuation, risk monitoring, and liquidation protocols behind the scenes. The borrower gets a loan in US dollars or stablecoins, with the crypto locked in a smart contract or custodial arrangement. Overcollateralization is standard — the loan amount stays well below the pledged asset's market value to cushion against price swings.
Who this targets
The service is aimed at the growing pool of crypto holders who are either underbanked or sitting on assets that traditional lenders ignore. Banks rarely accept digital assets as collateral. Figure's offering fills that gap, letting people unlock liquidity without triggering a taxable sale. The company is positioned it as a way to keep exposure to the upside of crypto while accessing credit for real-world needs — mortgages, business expenses, or debt consolidation.
Why now
Crypto lending has had a rocky history — high-profile blowups in 2022 scared off many players. But Figure comes from a regulated lending background and has been building on its own blockchain, Provenance. That infrastructure gives it control over the collateral process and compliance. The timing also aligns with a maturing market where institutions are more comfortable holding digital assets. Figure is betting that the infrastructure is finally ready for prime time.
The service is live now. Figure is starting with a handful of the largest cryptocurrencies, with plans to expand the list based on demand. The company hasn't disclosed loan volumes or interest rates yet, but early borrowers are already using it to access credit lines. For crypto holders who've been waiting for a simple, regulated way to borrow against their bags, that wait just ended.
