The SpaceX IPO scramble brings early lesson for tokenized stocks

The race to get into the SpaceX IPO left many crypto investors on the sidelines.

Binance Wallet, Bybit and Bitget canceled SpaceX pre-IPO offerings on Friday and refunded customers after failing to secure shares promised through xStocks, Kraken's tokenized equities business. The platforms had marketed the offering as a way for retail investors to gain access to one of the most sought-after IPOs in years through tokenized shares.

“Due to xStocks’ inability to deliver the underlying assets, no SpaceX allocations were received,” Bybit told users.

The episode, at first glance, might look like a failure of tokenization. But industry participants say the real bottleneck was much simpler: access to the underlying asset.

Too much demand, not enough shares

Getting access to SpaceX shares was always going to be difficult.

The company sought to raise $75 billion, with an initial plan to reserve 30% of the offering for retail investors. Demand quickly overwhelmed that allocation. Bloomberg reported retail orders exceeded $100 billion, while CNBC reported that the retail portion was cut to the low-20% range before pricing.