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Key Takeaways
- Coinbase launched pre-IPO perpetual futures via its Bermuda entity, with SpaceX as the first listed asset, settling all P&L in USDC.
- Competing platforms including Trade.xyz and Ventuals already offer similar products; Ventuals suffered a flash crash that liquidated over $1.5 million in positions.
- If SpaceX completes an IPO, Coinbase will automatically convert open pre-IPO positions into a standard SpaceX perpetual contract.
Coinbase has launched pre-IPO perpetual futures contracts, with SpaceX as the first available asset, opening the product to eligible users outside the United States through its Bermuda-licensed entity. The exchange described SpaceX as “just the first,” signaling plans to expand into technology, AI, energy, and space sectors.
How the SpaceX Perpetual Futures Contract Works
The SpaceX contract is structured as a perpetual futures position, allowing traders to go long or short on SpaceX’s implied valuation with no expiry date and no requirement to roll positions. All profit and loss is settled in USDC. The product is offered through Coinbase Bermuda Ltd., which holds a Class F license from the Bermuda Monetary Authority, and is not available to U.S. citizens.
In its legal disclosures, Coinbase identified several elevated risks specific to the product, including a valuation-based index pricing mechanism, IPO conversion risk, lower liquidity, and higher volatility relative to standard perpetuals. “Only trade what you understand,” the company stated.
Coinbase Enters a Market That Already Has Established Players
Pre-IPO perpetual markets for SpaceX are not new to crypto. Hyperliquid-linked platforms, including Trade.xyz, have offered similar products for some time. When Trade.xyz introduced its SPCX contract, the HYPE token rose to within 19% of its all-time high.
The token has since surpassed that level, recording a new all-time high as of writing and entering the top 10 cryptocurrencies by market capitalization.
A Competing Platform Suffered a Flash Crash and Mass Liquidations
The risks inherent to pre-IPO perpetual markets have already materialized on at least one competing platform. Ventuals, another provider offering SpaceX exposure, experienced a flash crash in its SPACEX-USDH market that sent the price from approximately $2,200 down to roughly $1,200, a decline of around 45%.
The event liquidated more than $1.5 million in leveraged positions. Ventuals attributed the crash to incorrect data from an off-chain price oracle and confirmed it would compensate affected users.
Coinbase Commits to Automatic IPO Conversion for Position Holders
Coinbase has stated that if and when SpaceX completes an IPO, all open pre-IPO perpetual positions will automatically transition into a standard SpaceX perpetual contract, with no further action required from the holder. The company has not disclosed a timeline for additional pre-IPO listings beyond the SpaceX offering, though it has indicated that technology, AI, energy, and space companies are among the sectors it is targeting for future contracts.
