Figure’s OPEN Network Pioneers Blockchain-Based Public Equity Markets

Figure’s launch of the On-Chain Public Equity Network (OPEN) shifts the paradigm for how public equity may be issued, traded, and held. Instead of securities held in the legacy DTCC depository system, Figure’s OPEN follows a “blockchain native” model: securities registered directly on chain; trading via Figure’s alternative trading system (ATS) with self-custody wallets; and DeFi‐style functionalities such as borrow/lend against shares via the Democratized Prime protocol.

This is not just a technology story—it reflects strategic positioning as Figure becomes both issuer and infrastructure provider. Figure will be the first to issue its own blockchain stock, and its share class is convertible one-for-one with its already-public Class A shares. This dual structure could enable arbitrage or synchronization across its NASDAQ listing and its blockchain native version. Support by market makers (Jump) and qualified custodians (BitGo) indicates early institutional buy-in.

Parallel regulatory innovations enhance the context. The Depository Trust Company (DTC), a DTCC subsidiary, has secured a No-Action Letter from the U.S. Securities and Exchange Commission to provide tokenization of select real-world, DTC-custodied assets—including Russell 1000 equities, ETFs, and treasuries—on pre-approved blockchains, with rollout expected H2 2026. These tokenized assets will retain identical legal rights to their traditional equivalents, with embedded compliance and cross-ecosystem liquidity.

Yet OPEN faces important headwinds. First, the legal/regulatory status of blockchain-registered securities is largely untested at scale; while no-action letters provide precedents, gaps in Exchange Act rules and disclosure regimes persist. ESMA in Europe has warned of investor misunderstanding around tokenized stocks, especially over whether shareholder rights (voting, dividends, class rights) are preserved. Second, liquidity may be fragmented: dual trading venues (traditional exchanges and the blockchain ATS) could diverge in price; continuous trading (24/7) vs market hours may raise valuation arbitrage issues. Operational and custodial infrastructure must scale robustly. Third, legacy intermediaries (prime brokers, custodians, DTCC itself) may resist or replicate competing models, leading to contest or cooperation dynamics.

On the upside, OPEN could bring cost savings by reducing reliance on DTCC, brokers, custodians, and back-office reconciliation. Continuous settlement, self-custody, transparent lending markets (replacing opaque stock borrow locates) may improve capital efficiency—especially for institutions and shareholders who previously derived less benefit from stock lending markets. Strategically, the company building OPEN (i.e. Figure) is placing itself as central infrastructure provider in this emergent blockchain capital markets stack.

OPEN also accelerates the competitive pressures on DTCC and traditional market infrastructure providers. DTCC’s tokenization service, while similar in goals, remains rooted in custody of eligible assets and traditional pooling; Figure’s model bypasses many incumbents with self-custody and on-chain issuance. The coexistence of DTCC’s tokenization and OPEN provides natural experiments for regulatory and market outcomes, especially in investor protection, systemic risk, and traceability of ownership and rights.

Open questions include: How will the SEC and FINRA enforce rules around continuous trading, market manipulation, order handling, and disclosure on a blockchain ATS? What interoperability will there be with DTCC custodial models? Will retail platforms, brokers, and institutional investors accept self-custody and embrace lending markets on stocks? And how will liquidity and pricing parity hold up between dual listings?