SpaceX Pre-IPO Bet Crashes 45%, Wiping Out $25M in Positions

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SpaceX pre-IPO bet crashes 45% while <a href="https://jpykr.com/hype-usd/">HYPE</a> holds near highs

Bonds linked to SpaceX, traded on Hyperliquid, experienced a significant drop in value after the price of the SpaceX-USDH contract fell sharply by around 45% in just half an hour.

Summary

  • SpaceX-USDH plunged 45% in 30 minutes, helping trigger liquidations that wiped out $25.27 million in positions over the past 24 hours.
  • HYPE rose near $62 after the crash, showing demand stayed firm despite new oracle concerns.
  • The selloff exposed thin liquidity gaps in pre-IPO perps as traders chased synthetic SpaceX exposure.

This action prevented around $1.5 million in forced sales and highlighted concerns about how easily prices can be manipulated, the reliability of data sources, and the risks of borrowing to invest in private companies.

Hyperliquid’s token, HYPE, didn’t immediately drop in price following the recent news. On May 29th, it was trading around $62, actually showing a gain of 8% over the previous 24 hours according to crypto.news data. This increase kept the token near its highest price in recent times, despite some concerns among traders about the risks associated with investing in markets before a company goes public.

SpaceX perp crash hits leveraged traders

The price of the SPACEX-USDH contract dropped from around $2,277 to $1,254 before bouncing back to near $2,169. Over the last 24 hours, liquidations totaled $25.27 million in positions, impacting 2,830 users and wiping out $1.58 million in collateral.

Before the price dropped, the market wasn’t very robust. There was only around $2.9 million worth of open contracts and daily trading volume was about $4.87 million. This meant traders were vulnerable when the price started to change quickly.

The recent price drop mainly affected smaller traders who were using borrowed funds. According to CoinDesk, the typical account that was closed out due to the drop only had $31 of margin. This suggests many individual traders were taking on high risk with limited capital, making them vulnerable to even a moderate price swing.

The event highlighted how rapidly losses can occur in artificial markets. Once prices drop below certain thresholds, automatic selling kicks in, which can further drive prices down. This can happen even if the initial price decrease was caused by a technical glitch or a problem with how the market is set up.

Oracle issue adds pressure to pre-IPO market

Ventuals believes the system failure was caused by incorrect information from Notice.co. Specifically, the problem seems to stem from how SpaceX’s recent 5-for-1 stock split was reported to the data source.

The team fixed the issue with the data source and will reimburse affected users within two days. While this should help lessen user losses, the incident highlighted a significant risk for those involved in pre-IPO agreements. These agreements rely on external pricing information, and a problem with just one data source can impact many users simultaneously.

Because SpaceX isn’t publicly traded, there’s no standard stock price available. This makes it difficult to accurately estimate values in alternative markets, more so than with traditional stocks or cryptocurrencies. It also means prices could jump significantly when new information becomes available.

The incident happened as more and more people in the crypto world were focusing on SpaceX. There’s been a lot of excitement about a possible SpaceX IPO, and Hyperliquid offered traders a chance to bet on the company’s future before it became available to the general public.

HYPE price reaction stays strong

Despite the recent price drop of SPACEX-USDH, the cryptocurrency HYPE actually increased in value. Data from crypto.news showed HYPE trading at approximately $62.46 on May 29th, an 8.17% rise over the past 24 hours. Throughout the day, its price fluctuated between $56.43 and $62.31, with over $1.02 billion worth of HYPE being traded.

The token’s price stayed close to its peak of $64.44 from May 26th. This indicates that traders saw the recent event involving SpaceX as a specific issue with that product, rather than a sign that they’d lost faith in Hyperliquid as a whole.

Hyperliquid has recently reached record levels, boosted by investments into ETFs and the increasing popularity of prediction markets, as reported by crypto.news. The ETFs associated with HYPE also saw over $100 million in net inflows in their first ten days of trading, further increasing demand for the token.

The HYPE token is still a major draw for traders on Hyperliquid. As we’ve previously covered, the platform’s Assistance Fund uses nearly all of its trading fee revenue – 97% – to buy HYPE tokens on the open market. This system connects how much trading happens on the exchange with the demand for the token, but it doesn’t eliminate the risks involved in trading.

Social posts add caution around sentiment

Despite the recent market downturn, commentary remained generally positive, though some statements require caution. For example, Hyperliquid Daily described Hyperliquid as a comprehensive financial platform and suggested it was attracting attention from Wall Street. They also reported a claim that the CEO of ICE considered Hyperliquid to be as significant as the NASDAQ.

As a researcher, I’ve been closely following Hyperliquid, and it’s rapidly evolving into a comprehensive financial platform. They’re not just offering perpetual futures contracts; they’re expanding into prediction markets, pre-IPO synthetic assets, and a full suite of DeFi solutions through HyperEVM. What’s particularly striking is their economic model: almost all of the fees generated – 99% – are used to buy back and burn their native token, $HYPE. Despite operating with a small team, they’re currently generating around $800 million in annualized revenue. This level of growth hasn’t gone unnoticed – even the CEO of ICE (Intercontinental Exchange) has publicly stated they believe Hyperliquid could become larger than NASDAQ.

— Hyperliquid Daily (@HYPERDailyTK) May 29, 2026

As a researcher, I’ve found the claim that something is ‘bigger than NASDAQ’ is best understood as a reflection of public enthusiasm rather than a confirmed fact. Unless I can find a direct source to back it up, I treat it as social commentary – essentially, what people *think* is happening, rather than official data or guidance. It’s important to remember that market hype can easily inflate perceptions.

I’ve been following a trader named Ansem, and he’s pretty bullish on HYPE. He thinks it’s holding up well, staying near its recent highs, and doesn’t expect it to drop back down to the $50 level. I’ve seen the price bounce a bit, which seems to support his idea, but it’s important to remember this is just his prediction – the market could still go either way.

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2026-05-29 11:30