Figure uses Kiavi to scale first-lien assets on tokenized rails

Figure is using M&A to press a bigger argument about where tokenization can go next. The company has agreed to acquire Kiavi’s technology and operating platform in a transaction valued at $717 million, while a joint venture with Sixth Street will acquire Kiavi’s balance-sheet assets. In practical terms, the move would bring a large residential investor-lending platform into Figure’s blockchain-native marketplace and give the company a faster way to scale first-lien assets onchain. For RWA markets, that is notable because it shifts the discussion from simple token issuance to full-stack control over origination, funding and secondary distribution.

The strategic value of the deal is in the flow it adds. Figure said the acquisition is expected to contribute about $7 billion in annual first-lien volume to Figure Connect and more than $100 million in monthly flow to Democratized Prime, its onchain warehouse marketplace. It also framed the combination as a roughly $200 billion annual origination opportunity that can be moved onto tokenized rails over time. Those are ambitious figures, but they point to the core thesis: tokenization becomes materially more relevant when it is attached to recurring, large-scale loan production rather than occasional structured products or isolated pilot assets.

Kiavi gives Figure access to exactly that kind of production channel. The platform focuses on financing residential real estate investors, especially through short-term residential transition loans and longer-duration debt-service-coverage-ratio rental loans. Kiavi says it has funded more than $30 billion in loans, and the companies said it generated more than $250 million in revenue and more than $100 million in EBITDA last year. On Kiavi’s own platform, the pitch is speed and automation for investors buying, renovating and renting homes, including digital workflows intended to close financing in days rather than weeks. That profile fits Figure’s attempt to industrialize credit movement through a marketplace architecture rather than a conventional warehouse-and-securitize model.

The acquisition also deepens Figure’s move into first-lien assets, which management has described as a much larger market than second-lien credit. According to the transaction materials, first-lien volume could rise to more than 40% of Figure’s consumer loan marketplace by 2027, up from a smaller share today. That matters because first-lien products tend to offer a bigger addressable market, clearer collateral positioning and broader investor familiarity. If Figure can route more of that supply through blockchain-based funding and trading infrastructure, the market gets a better test of whether tokenized credit rails can compete on cost, speed and standardization in a segment institutions already understand well.

There is also an operational angle beyond balance-sheet scale. Figure said Kiavi’s assets will become the first use case for Adaptor, its AI onboarding tool built to normalize originator data across Figure Connect and Democratized Prime. The broader idea is that blockchain provides the structured data layer while AI helps ingest and standardize messy real-world inputs from lenders and borrowers. That combination is central to Figure’s pitch that tokenization should not be treated as a wrapper applied after origination. Instead, the company is arguing that data formatting, eligibility checks, funding workflows and downstream trading all need to be designed as one system if onchain capital markets are going to handle real volume.

The deal still comes with execution risk. Mortgage and investor-property credit are operationally heavy businesses, and moving assets onto blockchain rails does not remove servicing, underwriting or legal obligations. Figure will need to integrate Kiavi’s origination stack without disrupting borrower throughput, preserve investor confidence in asset quality, and prove that the blockchain layer reduces friction in measurable ways. Markets will also watch the role of Sixth Street closely, since forward purchase commitments and balance-sheet support are part of what turns origination volume into financeable product. Without that institutional capital backing, marketplace claims can remain more aspirational than durable.

Even so, the acquisition is one of the clearer signs that RWA infrastructure companies are trying to win by owning distribution and loan flow, not just by offering tokenization software. Figure already markets itself as a blockchain-native capital marketplace connecting origination, funding and secondary activity. By bringing in a lender with established real-estate-investor volume, it is making the case that the next wave of tokenized assets may come from integrating conventional credit engines into onchain funding networks at scale. If the Kiavi transaction closes and the promised volume actually migrates, it would mark a meaningful expansion of tokenization from Treasury-heavy markets into the much larger territory of first-lien real estate credit.