Introduction
In May 2025, Figure Markets Holdings, Inc. presented a series of reports to the U.S. SEC Crypto Task Force, advocating for the integration of its innovative financial product, known as YLDS (Figure Transferable Certificates), into the settlement processes for digital currencies such as Bitcoin and Ethereum, along with other non-security cryptocurrencies on the Provenance blockchain.
Product Overview
YLDS, classified as an interest-bearing debt security, adheres to regulations set forth by the Securities Act and the Investment Company Act. This product is issued by an investment company registered with the SEC and is managed by a registered transfer agent, ensuring compliance with anti-money laundering (AML) and know your customer (KYC) statutes. This structured approach offers investors a level of account transparency and protection for their rights, making it a compelling option in the evolving landscape of digital assets.
Certificate Renewal Process
A critical aspect of these submissions is that the renewal process for the certificates mandates that both involved parties fulfill certain requirements, including passing a review of the registration statement and verifying compliance with account regulations. Furthermore, Figure proposed that their subsidiary, the Figure Certificate Company (FCC), would not be obligated to enforce AML/KYC checks on peer-to-peer trading activities. This is mainly because the FCC operates outside the typical definitions of financial institutions and, consequently, does not categorize peer-to-peer trading objects as clientele.
Strategic Merging of Transparency and Regulation
By merging the inherent transparency facilitated by Layer 1 blockchains with established regulatory frameworks, Figure Markets seeks to enhance both settlement efficiency and protections for investors, while strategically avoiding categorizations that would label its platform as a broker or exchange.
