A historic stock market debut is imminent, with SpaceX's initial public offering just six weeks away, and its impact on the crypto market is being closely watched. The company has filed a confidential S-1 with the SEC, aiming for a $75 billion capital raise at a valuation of $1.75 trillion.
If successful, this would be the largest stock market debut in history, surpassing Saudi Aramco's $29 billion record in 2019. However, this massive influx of capital may divert attention and funds away from crypto, potentially causing a downturn in the market. Other notable companies, such as OpenAI and Anthropic, are also planning to go public, which could further exacerbate the issue.
The combined capital raise of over $240 billion from these IPOs would exceed the total amount raised by all venture-backed US IPOs since 2000, according to PitchBook estimates. As a result, crypto may experience a decline in value as investors allocate their funds to these new IPOs.
The historical precedent of Coinbase's IPO in 2021, which marked the peak of the last bitcoin cycle, serves as a cautionary tale. The 30% retail allocation of SpaceX's IPO, approximately $22 billion, may also draw funds away from crypto. Furthermore, SpaceX's significant bitcoin holdings, worth around $600 million, make its IPO the first public-market debut of a company with a material bitcoin position disclosed under the new fair-value accounting rules.
The upcoming weeks will be crucial in determining whether crypto can withstand the impact of these IPOs or if it will experience a decline in value.