Formation Securities tells SEC it plans a tokenized stock venue on Solana

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The firm born from the Orca and Loopscale merger wants to run permissioned AMM pools for tokenized equities under the SEC's innovation exemption

Mon 9 Nov 2026 · 07:35 EST · 3 min read

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Formation Securities has formally notified the US Securities and Exchange Commission that it intends to operate a tokenized securities venue on Solana.

The firm plans to run under the SEC’s innovation exemption. That framework permits conditional secondary trading of eligible tokenized stocks through permissioned automated market maker liquidity pools, but only on qualified venues.

What Formation is actually proposing

Formation is the entity formed by the merger of two Solana-based DeFi protocols, Orca and Loopscale.

The company is headquartered in New York. Its team there is led by CEO Luke Truitt, and the plan is to lean on the trading and credit infrastructure the merged firm already operates while it pursues the licenses this kind of venue requires.

The venue itself would be what the SEC framework calls a Tokenized Securities Venue, or TSV. The core mechanic is an automated market maker. Think of a traditional exchange as a matchmaking service. Buyers and sellers post prices, and the exchange pairs them up. An AMM works more like a vending machine stocked by investors. Liquidity providers deposit assets into a pool, and a formula sets the price whenever someone trades against it.

The key word in Formation’s filing is permissioned. These pools would not be open to just anyone with a wallet, which is the main concession DeFi-style trading makes to securities law.

The exemption that makes this possible

The SEC issued its innovation exemption on September 17, 2026. It runs until September 17, 2031, giving participants five years of temporary relief from certain definitions in the Exchange Act.

Inside it, tokenized versions of National Market System stocks can trade through permissioned AMM pools on public, permissionless blockchains such as Solana.

The rules come with a notable guardrail. Tokenized stocks under the exemption must carry the same economic and voting rights as the underlying traditional shares. Synthetic products are excluded. So a token that merely tracks a stock’s price without conveying real ownership does not qualify.

Formation is also not alone in lining up. By late October 2026, at least three entities had submitted notices to the SEC, including TSV LLC on Canton Network and OKXICE on X Layer.

Why Solana, and why Orca’s history matters

Solana already has some tokenized equity track record to point to. Forward Industries has been trading on Orca since November 2025.

The merger of Orca and Loopscale also looks more strategic in this light. A securities venue needs both the trading rails and the credit plumbing, and Formation says it intends to draw on both as it works through licensing.

What this means for Solana, DeFi, and traditional markets

For the Solana ecosystem, the filing is a reputational win before a single regulated trade has cleared. A New York-based firm is telling the SEC that Solana is a credible home for tokenized NMS stocks. With Canton Network and X Layer also attached to SEC notices, the question of which blockchain hosts the most regulated equity activity is now a live contest.

There are real risks to watch. The exemption is temporary, ending on September 17, 2031, so any venue built on it is operating on a clock unless the SEC extends or formalizes the rules. Licensing is another open variable. Formation has said it plans to pursue the necessary licenses, which means the venue still has regulatory hurdles to clear before it can operate.

Disclosure: This article was edited by Vivian Nguyen. For more information on how we create and review content, see our Editorial Policy.