Mike Cagney, Co-Founder & CEO of Figure: The Inevitable Automation of Blockchain in Finance

Mike Cagney is the Co-Founder & CEO of Figure, a financial technology company leveraging Blockchain and analytics to deliver better financial products. In this conversation, Mike and Anthony Pompliano discuss how Figure works, why it is growing so quickly, where Blockchain makes sense in the traditional financial system, and why Mike thinks there is such a big opportunity for automation in finance. -----BlockFi allows you to keep your crypto, put it up as collateral, and receive a USD loan funded directly to your bank account. They do loans ranging from $2,000 to $10,000,000, and they're perfect for helping you reach your financial goals of all sizes. Visit BlockFi.com/Pomp to learn more about putting your crypto to work without having to sell it. -----If you enjoyed this conversation, share it with your colleagues & friends, rate, review, and subscribe. This podcast is presented by BlockWorks Group. For exclusive content and events that provide insights into the crypto and blockchain space, visit them at: https://www.blockworksgroup.io

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:01Anthony Pompliano?

  What's up everyone, this is Anthony Pompliano. Most of you know me as Pomp. You're listening to Off the Chain, simply the best podcast in crypto. Let's kick this thing off.

• 0:12Anthony Pompliano?

  Mike Cagney is the founder of Figure, a financial technology company leveraging blockchain and analytics to deliver better financial products. In this conversation, we discuss how Figure works, why it is growing so quickly, where blockchain makes sense in the traditional financial system, and why Mike thinks there is such a big opportunity for automation in finance. Mike's one of my favorite people we've ever brought on the podcast, and I really enjoyed this conversation. I hope you do as well. Before we kick off this podcast, first a word from our sponsor BlockFi. As many of you know, crypto investors store their digital assets on exchanges or in cold storage for long-term safekeeping. However, this strategy doesn't help them grow their investment

• 0:54Anthony Pompliano?

  holdings or build overall wealth. With the new BlockFi interest account, users can now securely store their Bitcoin or Ether at BlockFi and receive 6% annual interest, paid monthly in cryptocurrency. 6% is an absurdly high rate. It's the best rate in the industry. I highly suggest you go check out blockfi.com/pomp. Again, that's blockfi.com/pomp to sign up and start earning crypto today. Anthony Pompliano is a partner at Morgan Creek Digital. All opinions expressed by Pomp or his guests on this podcast are solely their opinions and do not reflect the opinions of Morgan Creek Digital or Morgan Creek Capital Management. You should not treat any opinion expressed by Pomp as a specific inducement to make a particular investment or follow

• 1:37Anthony Pompliano?

  a particular strategy, but only as an expression of his opinion. This podcast is for informational purposes only. Alright guys, I am here with Mr. Mike Cagney himself. We got a lot to get through, and I think that what you are building is probably one of the most underrated businesses in fintech, so I'm excited for this conversation. Thanks for coming in and doing this.

• 2:01Speaker 01

  Yeah, thanks for having me.

• 2:02Anthony Pompliano?

  All right, you've got a storied background. You've been doing this probably longer than I've been alive.

• 2:08Anthony Pompliano?

  And you've had a lot of success across the board. Maybe just walk us through your background for those that don't know it and then we can get into the blockchain stuff.

• 2:14Speaker 01

  Yeah, sure. I started off back in the mid 90s at Wells Fargo, ran proprietary trading and structured products there. I left to do my first startup in 2000, which was a wealth management company. Ultimately sold to Broadridge, started a hedge fund in 2006 that I actually still have today. It's part of the current business that we have. In 2011, started SoFi. 2018, started Figure. But really, the motivation of Figure wasn't to build another financial services platform. It was to build a blockchain. And one that could solve a lot of the problems that we were facing within the financial services ecosystem.

• 2:51Anthony Pompliano?

  Got it. And so you're probably best known, I think, in the technology world for SoFi. Maybe just give us a quick overview of what that was and kind of how this like fintech evolution has happened over the last, let's call it, 10, 15 years.

• 3:04Speaker 01

  Yeah, sure. So the immediate step was to digitize the process of asset origination. So being able to go online, get a loan without any human intervention, streamline the process, make it super efficient, super quick, and super accurate from a risk standpoint. And what we wanted to do was find a greenfield situation with a lot of macro tailwind. And at that point in time, it was student loan refinancing. No one had done that product before. It made a lot of intuitive sense. And that was really the beachhead that we used to build that product off. Obviously augmented with brand and community and so forth. But it was really a product that the market needed and a way to demonstrate the digital effectiveness of asset origination.

• 3:44Anthony Pompliano?

  Got it. And so as you're doing that, I'm sure you're running into some challenges. Did you come across crypto and blockchain while at SoFi and realize, hey, that may be able to solve some of this? Or was it kind of completely separate and that was the genesis of the idea for Figure?

• 3:59Speaker 01

  Yeah, so obviously, we were well aware of Bitcoin. And Bitcoin was a fascinating payment infrastructure and a great token ledger. And so we had a lot of appreciation for that. But we hadn't thought much in terms of applying blockchain technology into the solutions that we were doing. It wasn't really until I left, so if I had a chance to really dig into what was going on in the blockchain ecosystem, and that's really where the light went off for us in terms of how to apply that technology to problems we've had in the financial ecosystem for the last 50 years.

• 4:28Anthony Pompliano?

  Got it. And so you start Figure, and the company's now probably, what, 16 months old, or less than a year and a half old.

• 4:36Speaker 01

  Yep.

• 4:36Anthony Pompliano?

  We'll get to kind of how far you guys have gotten, but just give us an overview of what the company actually does.

• 4:40Speaker 01

  So there's two things that we do. So Figure is a financial services platform. We originate HELOCs and soon mortgages and other financial products. And we've done some pretty innovative work around that front in terms of you can get a HELOC from us in less than five minutes and we fund it in less than three days. So, you know, a differentiating product in that construct. But really, the financial platform was started because what we are first and foremost is a blockchain company. And we were looking at the financial ecosystem saying, boy, there is a lot of inefficiency in this marketplace. Shouldn't we be able to use blockchain to get rid of some of this intermediation, some of this rent seeking? So the administrators, the trustees, the auditors. And the idea was to take blockchain,

• 5:20Speaker 01

  apply it as both a ledger, but also a registry and an exchange. And no one had really done that before. What people were doing in the marketplace is they were taking the ledger, the token ledger, blockchains that were in existence and saying, okay, how do I get this to work for financial services? They weren't thinking about how do I build a blockchain to solve the financial services problem. And that was really the motivation behind it. What we realized very early on was the market wasn't ready to embrace blockchain. And so what we did is we created Figure to generate assets that the market wanted. And then we went to the buy side and said, hey, we're generating these really good HELOCs. Do you want to buy them? And they said, yeah, of course, we love them. Said, great, you're going to buy them all on blockchain. So what does that mean? Why do I have to do that?

• 6:03Speaker 01

  We walked through all the efficiencies they were getting, all the improvement in execution. And they said, all right, we'll do this if you get us financing. And then we started going to some of the banks. Obviously, Jefferies is one of the first partners that we have here, where we were able to line up the financing on the blockchain. And then out of that, got legal overhead and regulatory buy-in to everything that we were doing. And that gave us a green light to start the ecosystem. And that's what we did last fall. We started originating loans on blockchain, first ones to do that.

• 6:31Anthony Pompliano?

  Got it. And so maybe describe what a HELOC is and why start there?

• 6:35Speaker 01

  Sure. A HELOC is called a home equity line of credit. It's basically borrowing against the equity in your home. And the reason we started there is it's such a burdensome, cumbersome process. And as rates were moving up, people were doing less cash out refinancing, but they were building equity in their home. And so the idea was, hey, if we can make this a streamlined process, we can make it as easy as an unsecured consumer loan. So as easy as going to a lending club, for example, to get a loan. Then there's a way for high-quality borrowers to tap into their equity to meet things like debt consolidation or home improvement or education expenses that they couldn't do before. And so that was the whole motivation behind it. And it's taken off relatively aggressively. We're going to fund $80 million of ELOX this month on blockchain.

• 7:19Anthony Pompliano?

  $80 million in a single month, less than a year and a half after you started.

• 7:23Speaker 01

  Yeah, and we started originating them back in September, so even a shorter runway than that.

• 7:27Anthony Pompliano?

  Yeah, it's pretty incredible. I should caveat this whole conversation, I should say this at the beginning. We are investors in Figure, so take every comment I make with an incredible amount of bias, but obviously a huge fan. Let's talk a little bit about how it actually works, right? So when people hear, oh, it's on a blockchain, I think that there's a lot of confusion because they hear that from lots of people, right? And being able to do $80 million of loans on a blockchain. There's a lot of people who say they do this, but the blockchain is kind of, it exists, but it's not actually being used. Describe like how you guys are actually doing it from a technologist's standpoint.

• 8:00Speaker 01

  Yeah, and I think it's an important point that there's a lot of hype in the space. And when I say we're doing $80 million loans on blockchain, they're only on blockchain. This isn't done in parallel or they're done in a traditional way in parallel to the process. And the whole focus of this is the characteristic of blockchain being distributed, trustless, and immutable. And so what that means is when I put a home equity line of credit on the blockchain, I put a loan on the blockchain, I'm sending in the credit report, the title report, the property value digitally signed by source. What we build is a distributed stakeholder blockchain. So we have a set of 11 stakeholders that are all large financial enterprises that each hosts smart contracts specific to my underwriting box, for example.

• 8:42Speaker 01

  So they know what the cumulative loan to value cutoff is, they know what the FICO score needs to be, what the income needs to be. And I don't have to attest that any of the information I'm giving them is true because it's digitally signed by source. So it's signed by Experian or CoreLogic or Data Tree or whatever these data inputs are that go into that underwriting process. And so what we can do is authenticate the origination of that asset if it was done the way it should have been done. The blockchain is not there to reject it if it's not. It's just there to identify any exceptions that happen to be there. What was challenging in this is as an originator, you also want to prove things like you funded the loan or the loan paid. So there needed to be some bridge between blockchain and fiat.

• 9:23Speaker 01

  And what we built was this omnibus bank concept where when I fund a loan, say for example, for a hundred thousand dollars, I push a hundred thousand dollars into the omnibus bank. It delivers me a settlement token on the blockchain. You can think of that like a stablecoin effectively, but it's a claim to that specific pool of money. I then sell that back to the bank with the instruction to fund the loan and that memorializes the funding transaction. And 30 days from now, when the loan pays, the opposite happens. The money comes into the bank, they deliver a settlement token on the blockchain. I redeem that out, the loan amortizes, recognizes receipt. And what you end up getting out of this is a perfectly immutable record of asset provenance. So I know whether I originated it correctly. I know whether it's performed. Because it's a registry, I know whether that asset's encumbered, whether I own it outright,

• 10:07Speaker 01

  whether I pledge it to someone. And that introduces a huge amount of value you can create within the financial ecosystem.

• 10:13Anthony Pompliano?

  Got it. And so one of the things that's really interesting to me is the technology here is quite powerful. You've been able to prove out that it actually is faster, cheaper, you know, better rated, right? And so maybe describe how you think about the idea of it being kind of, you know, quote unquote, more efficient? And then also that we can get into some of the rating stuff that you guys have done already.

• 10:34Speaker 01

  Yeah, sure. So if you just look at the origination and financing process, we've identified that we're saving between 25 and 50 basis points on what we would pay to originate an asset off-chain. And so we're taking the process that we used to follow, the process we're following today. And there's a very clear benefit that we're getting from the technology. And that's because we reduce the cost of audit, we reduce the cost of compliance, we reduce the cost of reconciliation. All these functions that have to happen when you have disparate systems interacting to one another versus when you have a true chain of custody are meaningful. Our warehouse provider, in this case, the largest one we have right now is Jefferies, they've come out publicly and said they're generating savings on blockchain.

• 11:16Speaker 01

  And we think they're generating something about 50 basis points of savings on their transactions. When you get to the securitization process, we think it's about 30 basis points of benefit there on deal costs. And downstream, we're talking potential upside from the rating agencies. But more importantly, one of the benefits of blockchain is it delivers information symmetry. So a traditional asset-backed securitization, most people don't know what's happening in the underlying loans that represent those bonds, other than what's called the remittance date, it's the date that they show the performance of the assets. And it's usually 30 days old when you get it. Well, on provenance, our blockchain, you can look, let's say it's 5:30 today, I can see how many loans have paid me as of 5:30 today. And so, everyone has that information.

• 12:01Speaker 01

  That information symmetry leads to better liquidity and better execution. We think that could be worth up to 100 basis points or more in terms of transactions. So, we originally came into this thinking, maybe there's 90 basis points of value in this 3 trillion a year securitization ecosystem that we're targeting initially. I think there's actually probably closer to 200 basis points of value there.

• 12:21Anthony Pompliano?

  Wow. And so, that, let's say 90 to 200 basis points, what is that on a percentage basis as to what's actually getting paid?

• 12:28Speaker 01

  So, it's a combination of things. It's both a reduction in the fees that we would pay to the traditional custodians, and the DTCs, the MERS, the BONIs, the state streets. It's a reduction in staff expenses that you would pay. So, for example, in my last shop, I would have a dozen people deal with pledging loans every day, and figure, nobody does it, because it's all automatically handled through blockchain. But it's also an enhancement in market execution. So, getting better execution on your securitization, selling your bonds for more than you would have sold them off blockchain. So I think, one of the things that I got caught early on, was thinking myobically, purely about what rent seeking am I going to take out, versus what other efficiencies

• 13:11Speaker 01

  and what other improvements are coming in through the technology. And those outweigh the cost reductions.

• 13:16Anthony Pompliano?

  Yeah, so two things. When people ask about the company, I have been not very shy about my excitement. And so a lot of people will say, you know, I don't understand all the technical jargon. I don't understand why blockchain is important. And I just talk to them about you're automating a process, right? At the end of the day, that's all you're doing. You're taking something that is, you know, fairly bureaucratic, slow, high fees, and you're just automating it. And just like you would think of automation in any other field, there's obviously a lot of efficiencies and wins that are gained there. What is, I think, been very impressive to me is you don't run around and say that you're a crypto company or a, you know, quote-unquote blockchain company. You're a financial services business or a mortgage business or, you know, some sort of financial business that uses the blockchain.

• 13:58Anthony Pompliano?

  And I think that it's a small but very important difference in the way that you've kind of come to market. Maybe talk a little bit about that.

• 14:04Speaker 01

  Yeah, and I think the key is that this technology is going to become pervasive over the next 10 years. And in 10 years, we won't be talking about blockchain anymore because it'll be de facto the way that we do everything.

• 14:15Anthony Pompliano?

  It's like calling it an Excel-based company.

• 14:17Speaker 01

  That's right, that's right. Or an internet-based company, right? I mean, who isn't on the internet? And I think it will be literally that ubiquitous because the value proposition is just overwhelmingly compelling. And if you look at, it's not just efficiency. There's certainly significant efficiency that comes out of that. It's transparency and eliminating the need for trust because you have truth. And I think when you combine these things, you create such a powerful dynamic in a financial system that historically has been plagued by distrust and plagued by fraud and deception. And all these things go away. And so, you know, I think we're at the vanguard of something massive here. I think it's, call it, technology 2.0.

• 14:59Speaker 01

  I think blockchain is the most important thing to hit the financial system since the spreadsheet.

• 15:03Anthony Pompliano?

  Yeah, and so one of the things that also I think is a little bit different with you guys than most blockchain companies. I think a lot of people, especially in like the DeFi movement, or, you know, let's take down Wall Street. Let's kind of decentralize the world or kind of blow up the existing system. You're working with that system, right? And so talk a little bit about the balance there between disruption and also cooperation.

• 15:24Speaker 01

  Yeah, and there's certainly elements of disruption that are happening. And I think that most firms at this point are pragmatic. They have to have some level of self-disruption to persist. I think if you don't embrace that, you go extinct. And so, so think of a traditional function that's existed in a Wall Street bank like trading of loans. Well, blockchain allows buyers and sellers to connect seamlessly without any intermediation. So that historical function isn't going to exist, but other functions like financing loans or distributing bonds, those become more prevalent and actually easier to do on blockchain at higher margin. And so what, what the firms are doing are they're looking at certain aspects of their business and saying, look, we're going to lose this, but we're going to get this as a benefit.

• 16:08Speaker 01

  What the consumer's getting is ultimately the benefit of all this improvement. So early movers on blockchain, let's say, for example, there's, there's 150 basis points of net value to the blockchain in doing a securitization. Early movers are going to capture that rent back, the dealers, the underwriters, the buy side, but that will be competed away to the benefit of the consumer. As all great technology is deflationary, so is blockchain. And, and so what ultimately comes to this in steady state is a better deal to the consumer, better transparency, a better efficiency.

• 16:41Anthony Pompliano?

  Today, you were doing about $80 million this month, right? In, in loans. Any other stats or metrics you can share with us just to kind of give us a sense of how quickly this has grown and kind of where you are?

• 16:53Speaker 01

  Yeah, so, so back in September, we did a couple of million. And, and our expectation is, you know, to originate well over a billion dollars of credit this year. And, you know, in terms of, of efficiencies and savings, as I said, I think we're generating roughly, call it 50 basis points of value off of blockchain. In terms of the blockchain economics, what we try to do is capture a third of the fiat benefit on provenance. And so figure a loan, you know, should pay in excess of two and a half to three million dollars in fee income into provenance this year for the benefit of using that blockchain. That ignores all the other originators and issuers and so forth that are lined up to start onboarding on, on provenance as well.

• 17:37Anthony Pompliano?

  Got it. And then Provenance is a blockchain that you guys built inside of Figure, right, and have spun out now into its own separate entity. It's been capitalized separately. You'll continue to kind of establish it as its own external, you know, operating company. Describe a little bit about kind of what your plans are there, right? It's a little bit different model than I think we see in the like more open source based blockchain world, but but there are some similarities.

• 18:01Speaker 01

  Although Provenance is about to be open source. So and the expectation is Provenance is open source. Provenance has an SDK. It has a sandbox. Anyone can build smart contracts onto it that leverage Provenance. So Figure's not a gatekeeper for it at all. So we built it and the administrator of Provenance called PBI was a captive sub of Figure. It's now an independent entity outside. We still effectively control it. We're in the process of putting a board in place and staffing it up and so forth. But the administrator on Provenance is purely there to make sure there's no malfeasance. So they're making sure the smart contracts that are written aren't going to detract from the system integrity. They're making sure that the operators are going to do what they need to do. But anyone can use it. And so there's no gating in terms of who leverages it, for what purpose. It's really intended

• 18:46Speaker 01

  to be a utility to the broader ecosystem.

• 18:49Anthony Pompliano?

  Got it. And so I want to go now and say, look, you had this long history of bringing technology to financial services. You're continuing to do that. It's working, right? In the sense of you're doing what you set out to do. What does this look like 10 years from now, right? Not necessarily just Figure, but just blockchain intersecting with Wall Street Financial Services?

• 19:10Speaker 01

  Yeah, and this is where I think I have a different view than a lot of folks in the blockchain space. And so this would be somewhat orthogonal to, you know, to some of my peers' views. But, you know, a lot of people feel there's going to be lots of small blockchains and the key is interoperability of those blockchains.

• 19:28Speaker 01

  And I don't know why we would end up there because I think there's economies of scale that a blockchain that does what it needs to do should be applicable to any purpose. So provenance is just as functional in debt issuance or title or or stock transfer as it is in securitization. It's the underlying fundamental of distributed trustless immutable and the capability of a ledger registry exchange. So what what I see is really one blockchain winning it all. And that's going to come at the expense of traditional exchanges like NYSE and NASDAQ. And it'll come at the expense of traditional registrars like MERS and DTC. It'll come at the expense of traditional custodians like Bony and State Street. But what it's going to bring in is a massive level of efficiency and improvement that

• 20:13Speaker 01

  not only has a first order condition of reducing costs, a second order condition of providing better transparency, but a third, a tertiary condition of actually creating new opportunities, new products you can build off of chain that you couldn't do before because of either lack of visibility, lack of of cost effectiveness. So I think you're going to get a whole new generation of innovation in products that should be beneficial to consumers leveraging blockchain.

• 20:38Anthony Pompliano?

  Got it. And so part of this is you're starting with these HELOCs and around the mortgage industry. But really what you're describing is this could be any asset, right? You can kind of use the same mechanisms with a couple of tweaks, but the same underlying technology to do this. Why haven't more of these institutions come in? Is it just too small to date? Is it they don't understand it? What's holding them back?

• 21:00Speaker 01

  I think there's been a couple of challenges. I think one is, again, a lot of folks started with some of the big technologies that are out there, which are phenomenal ledger, token ledgers and great for payments and for for transmission of value. They're not necessarily great to represent a loan or a stock or a real estate asset. And so trying to do this tokenization, I think, is a little bit of putting a square peg through a round hole. So we had the luxury of benefiting from the work that people had done and looking at this and saying, if we were to build a blockchain solution from ground up to solve these problems, what would it look like? And so we happen to be in the right place at the right time to be able to build that solution. I think the other aspect was it was very clear to us early on, even if we built

• 21:45Speaker 01

  the most elegant technology platform in existence, it wouldn't get adoption because no one has inertia or reason to be first mover on this. And so the importance of creating Figure was we could be our own first customer on the chain. And that was a forcing function to get the broader financial ecosystem to buy in. That was necessary. Without that, it wasn't going to get off the ground.

• 22:05Anthony Pompliano?

  Why? I think a lot of the hardcore crypto community would say, oh, you could do this on Ethereum or you could do this on Bitcoin, right? What is the logic behind, you know, one, either why you can't, or two, why you chose not to?

• 22:20Speaker 01

  Sure. So if you take a pure token representation, you know, use Bitcoin as an example, I think it's a little orthogonal because you're taking a system that's predicated on eliminating the need for trust. And now you're trusting that, trust me, this token represents an asset that doesn't live on the chain. And I think that's a stretch because, you know, I always use this example when people talk about tokenizing art, like, yeah, it's great. I can fractionalize my Picasso, but you're having a huge assumption that that Picasso is actually there, hasn't been sold, and there's actually representation to it. And so you're just moving trust from one point to another. You're not actually creating a better system. I think in the context of Ethereum, there is the ability to put a loan on Ethereum.

• 23:04Speaker 01

  The issue is throughput, which is how do you get a 10,000 loan tape out of Ethereum in an efficient amount of time, you know, almost as fast as a database query? And that, again, is the benefit of us having to be able to go in and look at an architecture where we can say, hey, you know, there's needs that we have here, data throughput is one of them, that it has to work at least similarly in response time to a database. Pulling out, you know, 10,000 loans from an encrypted file and trying to represent them out in any meaningful amount of time. And when we see what happens to Ethereum when it has any reasonable loads on it, it doesn't respond. So even if we were to fork it, even were to build a forked version, we didn't feel that we'd get the throughput there that we needed.

• 23:46Speaker 01

  So we did a couple of things, which is, you know, as I said, we built a distributed stakeholder chain. We use our own encryption algorithms. We used some of the consensus framework out of Fabric. We had to rebuild the whole, you know, originally we started looking at Hyperledger, had to rebuild the messaging bus and the information bus on the underlying side to get it to scale out. But also, the way that we manage the distribution of data across nodes is done in a way that gives us real responsiveness. So, you know, when we, the other day, we were showing someone our loan dashboard and we pulled down a, you know, must have been like a 500 loan file loan tape, and it came literally at the, at the speed of the click. And they said, "How on earth did that happen?" It's because we had the benefit of architecting into that.

• 24:28Anthony Pompliano?

  Yeah, it makes, it makes a lot of sense. You're different than a lot of these companies in that you're dealing with securities. You're operating in a highly regulated environment, but you're admitting that, right? You're saying, "Hey, look, we, we know where we are. We're not trying to fool ourselves into thinking that we're not in a regulated environment." What has been regulators' reaction to this? Kind of how have you found what I'll call the rule makers or enforcers, right? How's, how have they reacted?

• 24:55Speaker 01

  Yeah, we, we try to be very proactive with the regulators, in particular the SEC on this. And, and starting with the fact that our blockchain has an underlying token native to that chain. And that token is, is effectively a pro rata right to the fees that are paid into the blockchain. So, under that construct, it's clearly a security, right? There's no, there's no reason to do a howie test relative to it. It's just a security. And so, we've approached it that way all the way through. And so, if you look at the capitalization of the founder, of the administrator that we set up, we sold token to do that. We did it as a reg d private placement, like you would any private equity offering. And my objective, and I've, I've said this publicly, is I would like this to be a public security.

• 25:36Speaker 01

  So, I'd like to do an S1. I'd like to have a public offering because I would want the SEC to regulate this. I'm trying to disrupt the largest ecosystem, the most regulated ecosystem in the world. And having the SEC there as a regulator, I think, is an important component to that. So, so we're not trying, none of what we do benefits from regulatory arbitrage, right? We've engaged the regulators out of the gate, and we think they have a very important role here. And by the way, the regulators should love this because it gives them a level of transparency and visibility and certainty that they never had before. If you think about what happened in 2008 and everyone trying to figure out where the loans were, that wouldn't happen on blockchain, right? The crisis still would have happened, but, but the resolution would have been a lot quicker and easier.

• 26:21Anthony Pompliano?

  I literally think of when I describe what you guys are doing, sometimes I think of the part of The Big Short where they're looking through the spreadsheets, right? And realizing like, holy shit, this is what is in these bonds. And again, I don't necessarily think the blockchain would have prevented it, right? But it definitely would have changed some of the dynamics there.

• 26:41Speaker 01

  That's right. It would have brought a lot more visibility, transparency, and accountability. It wouldn't necessarily have deterred the bad behavior, although a lot of people might have acted in a better way, knowing that their bad behavior would be immediately illustrated through information symmetry. But yeah, it's a huge benefit to the regulators.

• 26:59Anthony Pompliano?

  Got it. Where can people go find out more about Figure and what you guys are working on?

• 27:03Speaker 01

  So, well, Figure is obviously figure.com, but that's a financial platform. I think most of your listeners will go to provenance, so provenance.io. Our white paper is out there. We actually, hopefully by the time this is live, have published a cost comparison of on versus off-chain for the work that we're doing. And, you know, we're starting to build our community there, so it'd be great to get people involved.

• 27:25Anthony Pompliano?

  Awesome. Listen, I appreciate you doing this. I think that, you know, you guys are leading the charge, so a big fan cheering for you. We'll have to do this again in the future.

• 27:35Speaker 01

  All right, thanks.

• 27:36Anthony Pompliano?

  All right, guys. Thanks so much for listening to that podcast. Before I let you go, one more word from our sponsor, BlockFi. Their new interest account allows you to securely deposit your Bitcoin or Ether at BlockFi and receive 6% annual interest paid monthly in cryptocurrency. This rate actually compounds, so you receive a 6.2% APY, which is very attractive, given the alternatives. So you can actually take your Bitcoin, you can deposit it with BlockFi, and get paid an interest rate of 6% in return. Go check out blockfi.com/pomp. Again, blockfi.com/pomp to sign up and start earning interest on your crypto today.

• 28:16Anthony Pompliano?

  Hey, everyone. Pomp here. If you liked this episode of Off the Chain and want to help us take crypto to the top of the apple, Spotify, and other podcast charts, please do us a favor and rate, review, and subscribe. To review, simply go to the Off the Chain homepage, scroll down until you see the five blank stars. Taking 15 seconds to fill those stars in and leave a quick review goes a long way in helping us take the entire crypto ecosystem to the top of the charts. I appreciate you listening and see you next time on Off the Chain.