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Reno’s blockchain industry continues growth

By ThisIsReno

Story and Images by Ryan McGinnis

The word blockchain, to many people, is a puzzling term that might have something to do with cryptocurrencies, like Bitcoin. But the technology—which is not only associated with cryptocurrencies, but actually powers how they work—has the potential for a wide range of applications, stirring a new wave of economic potential that has even made its way to Reno.

Figure Technologies is part of that wave in Reno, joining companies such as Blockchains, LLC and Filament.

During a tour and ribbon cutting ceremony this week, Governor Steve Sisolak and EDAWN CEO Mike Kazmierski expressed excitement about the firm’s expansion to Nevada and congratulated the company for their excellent growth record.

Figure Technologies’ June Ou with Governor Steve Sisolak and EDAWN CEO Mike Kazmierski. Image: Ryan McGinnis

The early branch of Figure Technologies’ Reno office had only a dozen employees. Today inside its bustling new downtown office space, desks, each with a computer and a programmer, stretch nearly wall-to-wall. The number of local employees is close to 80, making an energetic scene as the task of office remodeling sprints to keep up with growing productivity.

June Ou, a co-founder and  COO of Figure Technologies, joined Gov. Sisolak in the ribbon cutting. Since 2018, she’s seen the company grow from its San Francisco beginnings to employing staff in Reno, Montana, New York, Utah and Pennsylvania. However, the financial world is nothing new to her. 

Ou was Chief Technology Officer and Vice President of Engineering at SoFi, an online personal finance company. Her husband and Figure’s CEO, Mike Cagney, was a founder at SoFi and also left that company before launching Figure.  

In many respects, SoFi helped start the first iteration of efficiency cost savings in the financial services world by removing the brick and mortar part of the business.

Now, Figure Technologies, led by Ou and Cagney along with Alana Ackerson and Cynthia Chen, is using its blockchain-powered platform Provenance, to further improve efficiency in the financial services industry.

Encrypted data is faster than paperwork

The Provenance platform helps to simplify and speed up the arduous and sometimes rent-seeking processes of auditing financial information and liquidating assets. The paperwork that encumbers student loan refinancing, home equity lines of credit, mortgage refinancing and securities—all finance products Figure Technologies provides or plans to provide in the future – slows the traditional loan market from making speedy transactions. The consensus it takes to verify the paperwork takes a long time to travel from party to party; it’s often disrupted by unnecessary third party channels too.

This is where the coveted blockchain technology comes into play.

Blockchain, put simply, is a method of data entry that is incredibly hard to manipulate without someone taking notice. It works just as the name would suggest: data is entered into a figurative block made of code; each data point occupies a side of the block. The other sides of block are security measures that indicate when data in the block has been manipulated.

The hash, as one side is called, is an auto-generated ID code for the block. The second fingerprint identifier is a side of the block reserved for the hash code of the previous block. Whenever data is changed in a block, a new hash is created and it does not communicate with the blocks that previously referenced it. 

In the world of cyptocurrency, these blocks are essentially a verified ledger of a financial transaction, of Bitcoin for example. These transactions are verified by proof-of-work, or in the endlessly confusing lexicon of blockchain technology, also called bitcoin mining. In this scenario, computer programs run through the blockchain to double check that the hash sequence remains unchanged, proving the transaction took place and is accurate.

Figure’s take on blockchain

Provenance works a bit differently. It relies on a consensus blockchain, meaning a group of people on the blockchain individually verify information before a consensus is reached and validated. Now all the auditors, regulatory agencies, brokers and loan seekers that play part in the financial service can speedily exchange information and trust its veracity. 

And the newest friend to the blockchain workflow are smart contracts: bits of code in the blockchain that interact with data. 

When all is said and done, Figure Technologies is pioneering this new application of blockchain technology to pass cost savings on to the consumer.  Because of blockchain, those looking for a loan can finish the application in a matter of days, weeks, or in some cases, months, faster than before, according to Ou.

“Financial services is a very old business that runs off of a lot of old technology,” Ou said. “And we don’t like change,” she joked, obviously a dissenter of that opinion. 

To keep up with the changing tides of technology and economic growth, EDAWN takes pains to attract business like Figure Technologies to Nevada. Its largest challenge nearly always boils down to whether the region has a workforce pool sophisticated enough to meet the demands of burgeoning technologies, like blockchain. 

In response to growing demand and the growth of blockchain technology, the University of Nevada, Reno’s Extended Studies offers courses and a certificate in blockchain.

Figure Technologies managed to hire most of their new employees from within the Reno job market, which is a good indicator that the city is on the right track to being on the frontlines of this strange, new, and downright astonishing world of coding technology.

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