Solana decentralized exchange Orca and lending protocol Loopscale have merged into a single company called Formation, headquartered in New York, the two teams announced Wednesday. Financial terms were not disclosed.

Loopscale co-founder Luke Truitt takes the CEO role. Fellow Loopscale co-founder Mary Gooneratne becomes chief operating officer, and Orca's Christopher Montagano serves as chief strategy and legal officer.

What does the merger combine?

Formation pairs Orca's trading infrastructure with Loopscale's credit order book and vaults. According to Loopscale's FAQ, the structure lets an issuer launch an asset with trading and credit live from day one, integrating liquidity, lending and vault products into one platform.

The combined entity draws on substantial existing activity, according to the companies' own figures:

• Orca has processed more than $550 billion in trading volume since launching in February 2021.
• Loopscale reports more than $150 million in deposits.
• Loopscale has facilitated over $2 billion in loans.

Orca raised an $18 million Series A in September 2021. Loopscale, formerly known as Bridgesplit, raised $4.25 million in 2021 from CoinFund, Jump, Coinbase Ventures, Solana Ventures and Room40.

Why target AI, energy, robotics and defense?

Formation aims to finance companies in AI, energy, robotics and defense — sectors whose financing needs it says traditional markets serve poorly. Truitt framed the merger as a bet that capital markets must keep pace with the industries they fund.

"Every major technological revolution has been paired with a financial one," Truitt said in the press release.

How does the SEC exemption fit in?

Formation's plans build on the SEC's Sept. 17 innovation exemption, a five-year order allowing tokenized securities venues to trade tokenized U.S.-listed stocks through permissioned automated market maker pools without registering as exchanges. Formation says it plans to operate such a venue and pursue additional licenses, leveraging Orca's nearly two years of engagement with securities and commodities regulators.

The company cautioned that its planned products remain subject to legal and regulatory requirements and may not be available to U.S. persons.

What happens to existing users?

Operationally, the merger changes little in the near term. Loopscale's lending, borrowing, vaults and order book continue running as before, and existing positions are unchanged, the FAQ states. ORCA will serve as the token for all of Formation, meaning Loopscale will not launch its own token. Loopscale points keep accruing and will convert later this year.

Over the next 12 months, Formation plans to introduce issuer tools and new capital allocation strategies alongside its existing trading, lending and vault products — a timeline that positions the firm to move as the SEC's five-year exemption window opens.