---
title: "Orca and Loopscale Merge Into Formation to Finance Tokenized Assets on Solana"
description: "Orca and Loopscale are merging into a single company called Formation, which pairs Orca's liquidity with Loopscale's credit and vaults so an issuer can launch a tokenized asset on Solana with trading and lending live from day one. Formation says DAWN Technologies launched a telecom debt product on the combined stack in under 30 days and took in more than $10 million in deposits in 24 hours."
author: "Mike Hale"
published: 2026-10-07T22:30:00.000Z
updated: 2026-10-09T16:52:16.977Z
category: "DeFi"
tags: ["Formation"]
canonical: https://stacksmith.xyz/articles/orca-loopscale-formation-merger
source: "Stacksmith"
---

# Orca and Loopscale Merge Into Formation to Finance Tokenized Assets on Solana

Orca and Loopscale are [merging into a single company called Formation](https://formation.so/#announcement), which pairs Orca's liquidity with Loopscale's credit and vaults so an issuer can launch a tokenized asset on Solana with trading and lending live from day one. The two teams announced the Orca Loopscale merger on October 7, 2026, and Formation is based in New York City.

Formation is aimed at AI, energy, robotics, and defense companies. It describes itself as the capital formation and allocation network of the frontier economy.

## What Formation combines

Formation puts liquidity, credit, and vaults under one company. An asset can launch, trade in a Whirlpool, be borrowed against, and be packaged into a vault on the same platform.

- **Liquidity.** Orca's Whirlpools, Riptide for professional market makers, and permissioned pools
- **Credit.** Loopscale's order book for fixed-rate loans with lender-defined terms, which accepts permissioned assets and Orca LP positions as collateral
- **Vaults.** Loopscale's Earn Vaults and Asset Curation

[Loopscale's FAQ](https://docs.loopscale.com/resources/formation) says credit works better with deep liquidity. Loopscale prices risk and onboards asset issuers, and Orca supplies the secondary market, which gives lenders a clearer exit and better collateral pricing.

Formation is working with Figure, Shinhan Asset Management, Superstate, R3, and Securitize to bring assets to market.

## Smaller assets are the target

Formation says fixed costs keep small financings out of capital markets. A $5 million financing takes much of the same underwriting, legal, servicing, and distribution work as a $50 million one. Formation calls that floor the "minimum viable asset" and says tokenization and DeFi lower it.

Formation's announcement cites three issuers.

- **OnRe.** Its reinsurance fund grew past $250 million with a cost of capital below 7% through onchain credit and yield markets
- **DAWN Technologies.** It launched a telecom debt product in under 30 days, with trading and credit live from day one and more than $10 million deposited in 24 hours
- **Figure.** Two of its assets reached nine-figure assets under management through DeFi credit and secondary markets

## What changes for users?

Nothing changes for existing users of either protocol. Whirlpool positions, loans, vault deposits, fees, and rewards stay as they are, and you don't need to withdraw, migrate, or sign anything.

Orca and Loopscale both continue as products under Formation. [Orca's FAQ](https://docs.orca.so/formation/faqs) and Loopscale's both say their programs, upgrade authority, multisig setups, and bug bounties are unchanged. The ORCA token doesn't change either.

## A tokenized securities venue is next

Formation plans to operate a tokenized securities venue under the SEC's innovation exemption. The SEC issued the exemption on September 17, 2026, and it sets a five-year framework for onchain trading of U.S.-listed stocks through tokenized securities venues.

Orca has spent nearly two years engaging securities and commodities regulators, and Formation says it will pursue the further licenses it needs to expand what it offers.

Formation's 12-month roadmap opens with issuer and originator tools. Allocator strategies and integrations follow, along with protocol work on credit, market making, and vault management, and new assets across fixed income and equities.

With the Orca Loopscale merger, Formation is betting that the next assets on Solana come from issuers too small for traditional capital markets. It expects them to pick the venue where a pool, a loan book, and a vault are ready on launch day, as they were for DAWN's telecom debt product.