SpaceX might be weeks away from the largest initial public offering (IPO) in history, and, quite surprisingly, the crypto world could get a piece of the action, but not in a way most investors would expect. On May 18, a synthetic perpetual futures contract -- a financial derivative that tracks a reference price indefinitely, with no expiration date -- tied to SpaceX began trading on Hyperliquid (HYPE +16.48%), a decentralized crypto exchange, under the ticker SPCX-USDC. The contract launched at a $150 reference price, implying a $1.8 trillion valuation for SpaceX, and on its first day of trading it recorded $33 million in volume.
The energy is understandable, as SpaceX filed a confidential S-1 form with the Securities and Exchange Commission on April 1, targeting a valuation between $1.8 trillion and $2 trillion, with a June listing target for the IPO. But you can't actually buy real SpaceX stock on Hyperliquid. What you can buy is something meaningfully different, so let's get into it.
Image source: Getty Images.
Tokens aren't the same as shares
SPCX was deployed using Hyperliquid's HIP-3 framework, a protocol upgrade that lets any builder who stakes 500,000 HYPE tokens (worth about $23 million) create their own perpetual futures market on the platform's infrastructure. The deployer, which in this case was Trade.xyz, operated by Hyperunit, Hyperliquid's own tokenization arm, sets the master price feed, the collateral structure, and the maximum allowable leverage for traders.
That means SPCX is a token that's created from thin air and that would be valueless if not for the crowd of people demanding to purchase it.
No SpaceX shares back the token, nor does anyone claim that to be the case; SPCX is not redeemable for actual SpaceX shares. There is no special purpose vehicle that holds the company's pre-IPO equity on anyone's behalf. Holding the token confers no ownership rights, no right to dividends, and no shareholder protections. SpaceX hasn't endorsed the token's provenance or commented on it in any way so far, and the company has no relationship to the token, its holders, or its issuers.
CRYPTO: HYPE
Key Data Points
To be clear, what the SPCX token does is that it enables investors to speculate about where other market participants think SpaceX's share price should be. Holders thus have a contract backed by nothing except market sentiment.
The risks are real and layered
The SpaceX token is, all told, far too risky to invest in, which is true of many of the listings on Hyperliquid.
The lack of association with SpaceX is perhaps the biggest concern. In mid May, similar tokens tied to a couple of very hot pre-IPO companies, Anthropic and OpenAI, crashed by more than 40% after both companies warned that share transfers made without the board's approval are void and carry no economic value.
Separately, the way SPCX's price is determined is a risk. Traditional perpetual futures contracts on Bitcoin or Ethereum anchor their price feeds to deep and liquid spot markets in the cryptos with continuous price discovery and a plethora of participants both big and small.
In contrast, SPCX has no public anchor by which to derive a fair market value. SpaceX shares trade only through private secondary markets, where access is gated to accredited investors and prices don't update in real time. When the reference price is opaque, the price of the derivative contract can be incredibly volatile.
Liquidity is also a potential issue. Thin markets increase volatility, widen spreads, and make exiting positions at expected prices harder, particularly during the sudden repricing events that tend to cluster around major IPOs.
And on top of all of the other risks, how the SpaceX shares might behave after the IPO is highly speculative. The target valuation implies extraordinary optimism about the company's growth.
SPCX is a fascinating experiment in price discovery for private assets. But it isn't something to buy. For investors, the real opportunity to evaluate SpaceX as an investment will occur when the public S-1 prospectus lands, and the business' actual shares begin trading.
