DeFi protocols Orca and Loopscale, both built on Solana, are merging to form a new entity called Formation. The combined entity aims to finance real-world sectors including AI, energy, robotics and defense, using blockchain for operations traditionally handled in boardrooms. Loopscale, which launched publicly in 2025, specializes in fixed-rate lending through an order-book model, a departure from the common pool-based approach in DeFi. The March 2025 integration opened access to over one billion dollars in liquidity through Orca and Raydium LP tokens. This shift toward real-world asset financing brings regulatory exposure and credit risk distinct from pure crypto lending, particularly in the sensitive defense sector.
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