Solana DeFi veterans Orca and Loopscale tie the knot, unveil "Formation" 🪐

Solana-based decentralized exchange Orca and lending protocol Loopscale are merging into a single entity called Formation, the two companies announced Wednesday. The combined firm is headquartered in New York, with Loopscale co-founder Luke Truitt serving as CEO, co-founder Mary Gooneratne as chief operating officer, and Orca's Christopher Montagano as chief strategy and legal officer. The announcements did not disclose financial terms.

Formation pairs Orca's trading infrastructure with Loopscale's credit order book and vaults, allowing an issuer to launch an asset with trading and credit live from day one, according to Loopscale's FAQ. Orca has processed more than $550 billion in trading volume since 2021, while Loopscale reports more than $150 million in deposits and over $2 billion in loans facilitated, per company figures. Orca launched in February 2021 and raised an $18 million Series A that September. Loopscale, formerly known as Bridgesplit, raised $4.25 million in 2021 from CoinFund, Jump, Coinbase Ventures, Solana Ventures, and Room40.

Formation is targeting AI, energy, robotics, and defense companies whose financing needs it says traditional markets serve poorly. Truitt framed the merger as a response to the pace of technological change. "Every major technological revolution has been paired with a financial one," he said in the press release.

The company is also exploring opportunities created by the SEC's Sept. 17 innovation exemption, a five-year order that lets tokenized securities venues trade tokenized U.S.-listed stocks through permissioned automated market maker pools without registering as exchanges. Formation said it plans to operate such a venue and pursue additional licenses, building on Orca's nearly two years of engagement with securities and commodities regulators. Its press release noted that planned products are subject to legal and regulatory requirements and may not be available to U.S. persons.

$ORCA will serve as the token for all of Formation, and Loopscale will not launch its own token, according to the FAQ. Loopscale points continue to accrue and will convert later this year. Over the next 12 months, Formation plans to introduce additional products, while Loopscale's lending, borrowing, vaults and order book keep running as before, with existing positions unchanged.