Formation Securities Plans Solana Tokenized Stock Venue Under SEC Innovation Exemption
Formation Securities has notified the SEC it intends to run a permissioned tokenized securities venue on Solana for tokenized equities. The venue would operate under the SEC's innovation exemption, which runs until September 17, 2031, and still requires licensing.
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What Formation Filed
Formation Securities has formally notified the US Securities and Exchange Commission that it plans to operate a tokenized securities venue on Solana. The New York-based firm was formed by the merger of two Solana DeFi protocols, Orca and Loopscale, and is led by CEO Luke Truitt. It intends to build on the trading and credit infrastructure the merged company already runs while it pursues the licenses such a venue requires.
The venue would be what the SEC framework calls a Tokenized Securities Venue, or TSV. Its core mechanic is an automated market maker, in which liquidity providers deposit assets into a pool and a pricing formula sets the price for each trade. The key constraint in the filing is that the pools would be permissioned, meaning access is restricted rather than open to any wallet holder.
The Innovation Exemption
The SEC issued its innovation exemption on September 17, 2026. It provides five years of temporary relief, running until September 17, 2031, from certain Exchange Act definitions. Under the exemption, tokenized versions of National Market System stocks may trade through permissioned AMM pools on public blockchains such as Solana, but only on qualified venues.
The exemption includes a notable guardrail. Tokenized stocks must carry the same economic and voting rights as the underlying shares, and synthetic products that merely track a stock's price are excluded.
Other Filers and Solana's Position
Formation is not the only applicant. 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. Solana already has some tokenized equity activity: Forward Industries has been trading on Orca since November 2025.
Sources differ on the venue's launch plans. Crypto Briefing reports the filing without a specific launch date. The Defiant reports that the venue targets trading in early 2027 in shares of Exodus, Forward Industries and Galaxy, with access restricted to verified investors. The Defiant's account is the only one of the two to name initial listings or a timeline, and neither source I was given confirms those details independently.
Open Risks
The exemption is temporary, so any venue built on it operates on a deadline unless the SEC extends or formalizes the rules. Licensing is also unresolved: Formation has said it will pursue the necessary licenses, so regulatory approval remains a hurdle before any trading can begin.
Why It Matters
For Traders
Tokenized equity venues on Solana remain pre-licensing, so near-term trading volume effects are speculative until the SEC and Formation complete the required approvals.
For Investors
The SEC innovation exemption creates a defined regulatory pathway for tokenized equities, but its September 2031 sunset makes the framework time-limited unless extended.
For Builders
Teams building permissioned AMM infrastructure should track the exemption's conditions, including the same-rights requirement and the qualified-venue standard, as they shape product design.
This article is for information only and is not financial advice. Read the full disclaimer.
