This Week in Fintech Figure's Blockchain and the Impact on Capital Markets
Oct 1, 2025
In a riveting chat, Mike Cagney, the co-founder and CEO of Figure, shares insights on the rapid evolution of blockchain in finance. He discusses Figure's recent IPO and introduces Democratized Prime, a revolutionary lending model that eliminates prime brokers. Cagney explains the significance of the Genius Act and how decentralized finance (DeFi) can upend traditional banking practices. With an eye on the future, he outlines the potential of stablecoins and the necessity for banks to adapt to these transformative technologies.
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Genius Act Unleashes Bank-Backed Stablecoin Rails
- The Genius Act legalizes bank-linked stablecoins and unlocks bank-led rails like JPM Coin.
- That creates cheaper payment rails and enables new challenger bank models built on coin custody.
Stablecoin Flows Threaten Bank Liabilities
- Large outflows into stablecoins could drain bank liabilities and stress credit funding.
- DeFi can reallocate that capital by offering retail yields and financing private credit.
Banks Should Build Defensive Coin Strategies
- Banks must decide to defend or adapt by building coin-native products and DeFi integrations.
- Leaning in early lets banks keep customer relationships and capture some economics instead of losing them.