xORCA Fees Face 40% To 10% Cut As Orca, Loopscale Merge
Key Points
- Solana DEX Orca and lending protocol Loopscale merged on October 7 to form Formation, with Loopscale co-founder Luke Truitt as CEO.
- Orca holds about $316.8 million in TVL, while Loopscale lists over $150 million in deposits and more than $2 billion in loans facilitated.
- xORCA stakers vote October 11 to 16 on cutting their protocol fee share from 40% to 10%, with ORCA down over 16%.
Orca, Solana’s top decentralized exchange, has merged with lending protocol Loopscale to form Formation, and xORCA stakers now face a vote that would cut their share of protocol fees from 40% to 10%. “Every major technological revolution has been paired with a financial one,” said Luke Truitt, Loopscale’s co-founder and now Formation’s CEO, as reported by Cryptopolitan. For your wallet, the deal is two decisions at once: whether a venue that pairs trading with credit is worth using, and, if you stake ORCA, how to vote before October 16.
Orca And Loopscale Merge Into Formation On Solana
The two teams announced the deal on October 7. Formation is a New York company, and financial terms were not disclosed.
The logic is simple. A new asset needs a place to trade and a place to borrow against, and Formation wants to offer both.
Orca brings its concentrated-liquidity pools, called Whirlpools.
Loopscale brings an order book that matches lenders and borrowers at fixed rates. It added curated lending vaults in June 2026.
Put together, an issuer can go live with trading and credit at the same time, Loopscale’s merger FAQ says.
Formation’s stated targets are AI, energy, robotics and defense companies. Figure, Shinhan Asset Management, Superstate, R3 and Securitize are named as partners in bringing digital assets to market.
Mary Gooneratne, Loopscale’s other co-founder, becomes chief operating officer.
What Orca’s $316.8M TVL And A 40% Fee Cut Mean For xORCA
Orca holds about $316.8 million in total value locked and cleared over $8 billion in DEX volume in the past 30 days, per DefiLlama data.
Loopscale lists more than $150 million in deposits and over $2 billion in loans facilitated.
Orca’s Council is scrapping an on-chain vote opened on October 5 and reposting the same proposal.
Voting now runs from October 11 to October 16, with a two-day cool-down through October 18. The Council cited trouble letting xORCA stakers take part.
The proposal would cut xORCA’s share of protocol fees from 40% to 10%. That removes three-quarters of stakers’ fee stream.
It would also dissolve the Council and move a community treasury of 14.2 million ORCA into a team-controlled “Strategic Account” earmarked for acquisitions.
Strip away the frontier-finance pitch and this is really about whether ORCA stakers keep a fee stream or fund a team acquisition budget.
ORCA trades around $2.34, down more than 16% since the news came out.
The announcement gives no Loopscale lending rates or xORCA payout figures, so there is no yield to compare yet.
If you hold xORCA, track Solana DEX and RWA venue moves on RWA Insider before the window opens on October 11.
Formation’s SEC Innovation Exemption Venue And What To Watch
Truitt framed the merger as capital markets catching up. “We’re at an inflection point that requires capital markets to keep pace with the industries reshaping the economy,” he said.
Formation plans to run a tokenized securities venue and to ship issuer tools within 12 months.
That plan rides on an SEC order released on September 17. It gave tokenized securities venues a five-year, conditional “Innovation Exemption.”
Qualifying venues can trade tokenized stock through permissioned automated market makers and liquidity pools without registering as exchanges. The relief covers tokens backed by real shares.
Read “permissioned” carefully. The relief also caps symbols and volume, and operators must be U.S. persons under OFAC rules. Do not expect an open pool any wallet can join.
Orca has run gated pools before. RWA Insider covered Orca’s KYC pools for Streamex gold in May, a working model for a permissioned venue on a Solana DEX.
Watch the partner list. Figure, Superstate and Securitize already issue tokenized assets, so the first one to list on Formation shows whether the trade-and-borrow model gets real supply.
If the xORCA vote passes on October 16, stakers swap most of their fee stream for a bet on Formation’s acquisition budget. Whether that bet pays depends on the tokenized securities venue arriving inside its 12-month window.
Check your xORCA balance and read the reposted proposal before voting opens on October 11.
Frequently Asked Questions
What is Formation, the company behind the Orca and Loopscale merger?
Formation is the New York company formed when Solana DEX Orca merged with lending protocol Loopscale, announced October 7. It combines Orca’s Whirlpools liquidity with Loopscale’s fixed-rate credit order book and targets financing for AI, energy, robotics and defense companies.
When can xORCA stakers vote on the Orca proposal?
The reposted proposal is set for voting from October 11 to October 16, followed by a two-day cool-down through October 18. The original vote, opened October 5, was scrapped because the Council cited trouble letting xORCA stakers take part.
How much of Orca’s protocol fees would xORCA stakers lose?
The proposal would cut xORCA’s share of protocol fees from 40% to 10%. It would also dissolve the Council and move 14.2 million ORCA from the community treasury into a team-controlled Strategic Account for acquisitions.
Can I trade tokenized stocks on Formation yet?
Not yet. Formation plans a tokenized securities venue under the SEC’s Innovation Exemption and aims to ship issuer tools within 12 months. That exemption covers permissioned pools, so expect an access check rather than an open pool.
