Orca and Loopscale Merge to Form Formation for AI and Defense Finance

Solana-based decentralized exchange Orca and lending platform Loopscale have merged to create a new company called Formation, combining trading, credit and investment infrastructure under one roof.

The new entity will be led by Loopscale co-founder Luke Truitt as CEO. Formation plans to use Orca’s liquidity and trading infrastructure alongside Loopscale’s lending and vault products to help assets move from issuance to financing and eventually trading.

The bigger goal is to take this model beyond crypto. Formation is targeting capital-intensive sectors including AI, energy, robotics and defense, where companies can require significant financing before their assets or businesses reach broader markets.

Formation combines trading and lending

Orca and Loopscale bring different pieces of the financial stack to the new company.

Orca has built one of Solana’s largest decentralized trading platforms, processing more than $550 billion in trading volume since 2021. Loopscale, meanwhile, focuses on credit and investment vault infrastructure, with more than $150 million in deposits and over $2 billion in loans facilitated.

Formation wants to connect those capabilities so an emerging asset can have a more complete path from launch to financing and liquidity.

That means an issuer could potentially use Formation's infrastructure to structure an asset, find financing, create investment strategies and eventually bring that asset into a liquid trading market.

The approach also reflects a broader shift in DeFi. Instead of focusing only on trading existing crypto assets, platforms are increasingly building infrastructure around tokenized real-world assets, credit and capital markets.

AI and robotics are the next target

Formation is specifically positioning itself around what it calls the “frontier economy.”

AI, energy, robotics and defense companies can require large amounts of capital for infrastructure, equipment, research and expansion. Formation argues that traditional financing can become expensive for smaller transactions because underwriting, legal, servicing and distribution costs can make smaller deals less attractive.

The company's strategy is therefore not simply to create another DeFi trading venue. It wants to reduce the cost of structuring and distributing assets while eventually connecting them with regulated U.S. capital markets.

That direction fits with the rapid growth of tokenized assets on Solana. The network's real-world asset market crossed $4 billion in August, with tokenized equities becoming one of its fastest-growing categories.

Related: Solana’s real-world asset ecosystem crosses $4 billion

Tokenized assets are already moving deeper into Solana

Formation's timing also comes as more traditional financial products move onto Solana.

Just this week, Backpack expanded its Solana-based tokenized asset offering with a tokenized Brazil ETF and Cerebras shares, alongside NEAR trading products. That development showed how Solana is increasingly being used as infrastructure for both traditional securities and crypto markets.

Related: Backpack expands Solana tokenized assets with Brazil ETF, Cerebras and NEAR

Formation is taking a different but complementary route. Instead of focusing only on bringing existing securities onchain, it wants to build infrastructure that helps emerging assets access issuance, credit, investment strategies and secondary liquidity.

The company said it is already working with Figure, Shinhan Asset Management, Superstate, R3 and Securitize to bring assets to market and expand their distribution.

Orca and Loopscale will continue

The merger does not mean the existing protocols are disappearing.

Formation said both Orca and Loopscale will remain the foundation of the ORCA and xORCA token network, while the new company builds additional capabilities around their existing infrastructure. The financial terms of the merger were not disclosed.

Orca's existing role in Solana's trading ecosystem gives Formation access to established liquidity infrastructure, while Loopscale adds credit and vault capabilities. Bringing those pieces together is the core of the new company's strategy.

Formation targets the next stage of onchain finance

Formation plans to launch new tools for asset issuers and additional investment strategies over the next 12 months. Its stated roadmap covers origination, issuance, liquidity, credit and distribution, with a longer-term path toward regulated U.S. capital markets.

That makes the Orca-Loopscale merger notable beyond the two protocols themselves. It reflects a broader attempt to turn DeFi infrastructure into a more complete capital-markets system, where tokenized assets can be issued, financed and traded through connected onchain infrastructure.

With Solana already seeing rapid growth in tokenized equities and other real-world assets, Formation is betting that the next opportunity is not just bringing assets onchain, but building the financial infrastructure needed to help them grow.