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Tokenized real-world assets

Figure YLDS (Figure Transferable Certificates)

Not approved No defect found; not on the approved list
Verdict
Not approved
No defect found; not on the approved list
Who can freeze it
Issuer can freeze
Figure Certificate Company issues YLDS as an SEC-registered, yield-bearing security; the legal issuer, prospectus, transfer controls, and $1 redemption framework govern the claim.
Withdrawals
A holder gets cash by surrendering the certificate to FCC.
Reviewed
2026-09-23 · next 2026-12-23
Researched memo

Summary

Ketju does not approve YLDS: a holder’s claim rests on one thinly capitalized Figure subsidiary, Figure companies run every step and hold most of the supply, and Figure can block, reverse and reissue any holding. We found no defect in the certificate’s legal form. YLDS is a face-amount certificate. Figure Certificate Company (FCC), a Figure subsidiary registered with the SEC as a face-amount certificate company, issues it under a prospectus dated April 24, 2026 (registration 333-275154). The prospectus calls the certificates ”interest-bearing debt securities” that are ”unsecured and solely backed by the assets of Figure Certificate Company.” A holder is a creditor of FCC and owns no Treasuries or fund shares. At June 30, 2026 FCC held $561.9 million of qualified assets against a $557.5 million certificate reserve, and its own equity was $994 thousand. Figure’s parent and affiliates held $477.5 million of the $556 million of certificates.

Research

What the holder owns

A face-amount certificate is an old instrument, defined in the Investment Company Act of 1940. The issuer promises to pay a fixed face amount plus interest, and the Act requires it to hold reserves against that promise. FCC’s prospectus says it is aware of ”only one other face-amount certificate company in existence today.” FCC was formed in Delaware on April 13, 2023 and began issuing on February 18, 2025. The 10-Q dates the launch of the Transferable Certificates, ”called YLDS,” to February 20, 2025.

The claim runs to FCC alone. ”When you buy a Certificate, you are buying an obligation of FCC, which are unsecured and solely backed by its assets, to pay you the amount of your principal investment.” FCC pledges no asset to holders. Instead, the Act ranks them ahead of FCC’s owner: ”FCC’s obligations to its Certificate holders (i.e., the debt holders) have priority over FCC’s obligations to its equity holders.” Certificates carry no vote and no share of dividends. They mature twenty years from issue at face plus accrued interest.

Face is $0.01 per certificate. The rate is overnight SOFR less 35 basis points, with a floor of zero. Interest accrues daily to the holder of record at 6:59 pm Eastern. FCC pays it on the first of each month as new certificates, unless the holder chooses dollars. FCC rounds down to the penny, so a very small balance can earn nothing. A holder may surrender a certificate at any time for face plus accrued interest. The prospectus states that this is not a money market fund: FCC ”does not seek to maintain a stable value of $1.00 per share,” is not bound by Rule 2a-7, and values its reserves at amortized cost.

Size and holdings

The Act requires FCC to keep qualified assets at least equal to its certificate reserve plus $250,000 of capital. Qualified assets are investments that a District of Columbia life insurer may hold. The June 30, 2026 10-Q shows $561.9 million of qualified assets on deposit: $555.7 million in securities at UMB Bank, $0.7 million cash at Flagstar, and $5.5 million at Lead Bank in an account that Figure Payments holds. The securities were seven Treasury bills of $25 to $75 million, maturing between July 14 and September 24, 2026. They also included two overnight repurchase agreements backed by Treasuries: $82.4 million with UMB and $200 million with Hidden Road Partners CIV US LLC.

The certificate reserve was $557.5 million. Assets exceeded the reserve by about $4.4 million, and stockholder’s equity was $994 thousand, so the cushion is thin by design. KPMG audits the annual statements. The prospectus lets FCC hold corporate debt, asset-backed securities and mortgage loans as well, but the June book held none. FCC reports the backing each quarter.

Most holders are Figure companies. ”As of June 30, 2026 and December 31, 2025, the Parent and affiliate entities held $477.5 million and $252.3 million of Transferable Certificates.” Third parties held $78.5 million. In the first half of 2026, affiliates bought $539.4 million and surrendered $319.8 million. Separately, ”there were $347.8 million” of certificates ”lent by Transferable Certificates holders into the Democratized Prime platform.” Democratized Prime is Figure’s lending market, backed by Figure Lending’s HELOCs. The filing does not say how the two figures overlap. Schedule VI counts 3,450 accounts at June 30, up from 1,768 at year end.

Fees

FCC paid its adviser, Figure Investment Advisors, 0.25% of net invested assets until October 2025, 0.15% until April 2026, and 0.10% since. The 35 basis-point spread below SOFR pays that fee and FCC’s costs, including gas on every chain. FCC charges no issue or surrender fee. A holder who surrenders by ACH pays the ACH cost. The adviser, the administrator, the transfer agent and the KYC provider are all Figure companies.

Eligibility

The prospectus sets no investor test. A buyer opens an account at ylds.com and gives a taxpayer ID, name, birth date, address and ID. Figure Payments Corporation, FCC’s AML and KYC provider, reviews the buyer, and FCC pays it $2.00 per review. ”Each potential investor must pass AML/KYC review by the AML/KYC Service Provider before being approved by FCC to open an FCC account.” The account is a wallet: ”An investor’s FCC account is represented by its wallet.” FCC holds no one’s key. The investor holds the key or uses a custodian.

”There is no minimum initial purchase amount for the Figure Transferable Certificates, and there is no minimum on the amount a Certificate holder may hold.” ylds.com says the minimum is one certificate and that ”YLDS can be held globally, by eligible retail and institutional customers.” It adds that eligibility ”may vary by jurisdiction.” The prospectus covers non-US holders only through tax forms: they file a W-8. No document we read lists the US states where FCC sells the certificates.

A buyer pays by wire, ACH or a Figure Payments stored-value account. Since the August 6, 2026 supplement, a buyer can also send an accepted stablecoin to Figure Payments, which converts it to dollars and pays FCC. A Figure Installment Certificate, with a $1,000 minimum, is registered but not yet issued.

How it works

FCC calls YLDS a ”digital asset security” because it splits the ownership records. The chain holds the wallet address, the number of certificates, and each certificate’s issue and cancellation dates. A private database holds the holder’s name and address. The transfer agent is Figure Equity Solutions, Inc., an SEC-registered transfer agent (file 084-06830) that Figure Technology Solutions owns. ”The Transfer Agent’s records constitute the official Certificate holder records of FCC and govern the record ownership of Figure Certificates in all circumstances.” If a chain balance disagrees with those records, the transfer agent’s records control.

Transfers are peer to peer, at any hour, and always at face: ”Peer-to-peer and ATS transactions will occur on-chain and will occur at the face amount of a Figure Transferable Certificate ($0.01/Certificate).” Side deals off chain may use another price. Both sides need a wallet that FCC has approved, and a transfer to anyone else is void: ”if a potential transferee of record ownership is not approved on FCC’s records, the potential transfer of Certificates will be unauthorized and will be reversed by the Transfer Agent.” FCC pays gas. It reconciles on-chain transfers to the off-chain record at least daily.

To move between chains, FCC burns or vaults certificates on one chain and mints them on the other, and the official count does not change. The prospectus names Provenance as the primary chain. It lets FCC use Solana, Stellar, Avalanche and Sui ”upon request,” and Tempo since the June 30, 2026 supplement. ylds.com lists two live chains: Provenance for minting, redemption and transfer, and Stellar for settlement and payments. A registered ATS may trade the certificates. FCC names Figure Securities’ ATS as a settlement venue, but no document we read shows YLDS listed for trading there.

Who controls it

FCC can freeze, move and burn certificates by design, and the prospectus presents this as a feature: ”Certificates are not in bearer form.” FCC and the transfer agent keep ”administrative control over the on-chain record regardless of whether transactions involve FCC.” They ”are able to block blockchain wallets if a transaction is made in error or if a private key has been lost or stolen,” and they can append correcting transactions. On a lost-key report they ”may isolate the particular Certificates in the wallet in question, cancel such Certificates,” and reissue them to a new wallet. Under AML and sanctions law, FCC may ”block” an account by refusing purchases or surrenders, suspending proceeds or segregating assets. The transfer agent’s chain framework makes ”Clawback/ Administrative Balance Control” a requirement for any chain it uses.

On Provenance the token is the marker uylds.fcc, with six decimals, at account pb1y65reayayr4285ajlsltc8c8csvjcp5jlmys2f. On 2026-09-23 the chain showed a restricted marker with forced transfer allowed. Any holder needs the account attribute approved.ylds.pb. Governance control is allowed, so Provenance’s validator governance can also act on the marker. A group-policy account (group 722) holds full admin rights: six Figure members of equal weight, a 51% threshold and a 48-hour voting window. Five other accounts, each a single secp256k1 key, hold mint, burn, withdraw and forced-transfer rights, so each can move any holder’s balance. One of them can also delete the marker. Four more single keys hold transfer rights only. Supply was 474,277,955.68 YLDS. Ketju’s daily check cannot yet read Provenance markers. We took these facts from the chain’s own REST endpoints, and Ketju does not yet check them daily.

On Stellar the asset is YLDS issued by GAC7MOPTQLQUM3KC24AW4GHS3RLF72LPEZO54AH7EZ6TSMGRB5SOAVH3, the issuer that FCC names in the stellar.toml at ylds.com. At least six copycat YLDS assets from other issuers exist. On 2026-09-23 we found authorization required, authorization revocable, clawback enabled, and flags not locked. The issuer account has one signer, its own master key, with all thresholds at zero. That one key can mint, admit or drop a holder, freeze and claw back. Supply was 25,173,495.77 YLDS across 9 authorized and 273 unauthorized trustlines.

Withdrawals

A holder gets cash by surrendering the certificate to FCC. ”You may request a withdrawal by surrendering your Certificate at any time. Surrenders of Certificates will be processed within 24 hours,” or longer if the chain is congested. Cash arrives by wire or ACH, which ”may take up to 5 days,” or as an accepted stablecoin through Figure Payments, which ”may take up to 10 days.” On Stellar the holder sends YLDS to a redemption address unique to its account. There are no surrender charges and no minimum.

At June 30 the book could meet a run: $282 million of repo matured the next day, and every bill matured within three months. In the first half of 2026 holders surrendered $762.8 million, and FCC paid it. ylds.com advertises ”Credit-line-backed liquidity.” The prospectus says FCC ”does not and does not intend to borrow money,” though it may open a short-term bank line. No line appears in the 10-Q.

Losses and incidents

The risks are in FCC. A loss on the assets beyond the $4.4 million surplus would leave FCC short, and FCC’s parent has so far paid its costs by capital contribution. Surrender depends on Figure Payments and the Figure portal working. If FCC withdraws a wallet’s approval or blocks an account, the holder cannot surrender until FCC restores it. A holder can sell peer to peer only to another approved holder, at face. FCC says there ”may be relatively few investors” to sell to.

Comparison

On legal form, YLDS is the cleanest yield-bearing dollar token a US client can hold. It is registered and open to retail. FCC processes surrenders at par within a day, and T-bills and Treasury repo back it. Ketju classes YLDS as a tokenized real-world asset and not as a payment stablecoin. It is a registered security whose yield comes from Treasuries and repo held off chain. FCC itself says the certificates are not a stablecoin, are not money market fund shares, and lack ”the attributes of real currency.” Figure markets YLDS as exempt from the GENIUS Act’s yield ban. That is Figure’s reading; no regulator or court has ruled on it. The riadefi stablecoin guide lists YLDS for comparison. Hastra’s wYLDS on Ethereum and Solana is a separate wrapper with its own memo. Neither is FCC’s certificate.

If an advisor uses YLDS, we would keep the position modest and test a surrender end to end first. A client who self-custodies in an approved wallet raises a custody-rule question that the adviser must settle before buying.

Open questions

Figure’s own copy confuses the unit. ylds.com says ”1 YLDS = 1 Certificate = $0.01 NAV.” The chain shows otherwise. Provenance’s denom metadata makes one YLDS equal to one million uylds, and DefiLlama and CoinGecko price that unit near $1.00. In September, 499 million units sat on two chains, against a $557 million reserve in June. Those figures agree only at about $1 a unit. A displayed YLDS is therefore $1, or 100 certificates. An adviser should value positions in dollars until Figure corrects its site.

Other questions remain open. We do not know the state list. We do not know whether Figure Equity Solutions’ records treat Stellar balances exactly as Provenance balances. We do not know how the $477.5 million affiliate holding and the $347.8 million Democratized Prime balance overlap. We do not know whether a registered adviser can treat a client’s approved self-custody wallet, or a hosted wallet, as held by a qualified custodian. ylds.com mentions custodian support and shows Fireblocks as a partner, but it publishes no custodian list.

Sources

Each claim above comes from one of these sources. Where Ketju could not verify a number, the memo states that.

The asset and the chain

This memo covers the protocol. A position also holds an asset and settles on a chain. Whichever of the three holds the most power over the position decides who can freeze it. These tables describe control and do not judge quality.

ChainVerdictFreezeWhat it can do
Provenance BlockchainApproved with limits Governed, no freeze the validator set is public, but governance can move quickly and the native marker module gives individual asset administrators freeze, restriction, and force-transfer powers.
StellarNot approved Issuer can freeze freeze is native at every level: issuers hold revocation and clawback flags on their assets, and since Protocol 26 the validator quorum can vote to freeze specific accounts and trustlines on-chain (CAP-77).
AssetFreezeWho can freeze it
YLDS Issuer can freeze Figure Certificate Company issues YLDS as an SEC-registered, yield-bearing security; the legal issuer, prospectus, transfer controls, and $1 redemption framework govern the claim.
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