Chainfeeds Summary:
Between 2015 and 2024, the average annual fundraising size in the US IPO market will be only about $50 billion. Whoever can successfully capture secondary market trading volume and the attention of the broader financial market through price discovery mechanisms will achieve tremendous success.
Article source:
https://x.com/castle_labs/status/2056724568958476615
Article Author:
Castle Capital
Opinion:
Castle Capital: 2026 is one of the most active years for IPOs, and the largest IPO calendar cycle in a generation. Last Thursday, Cerebras (ticker symbol: CBRS) opened on Nasdaq at $350 on TradeXYZ's first Pre-IPO Perpetual Market (IPOP), after its repriced IPO price of $185. An IPOP is a synthetic perpetual contract that reflects a private company's implied valuation before its IPO. Traditional IPO subscription books are oversubscribed by more than 20 times, leaving neither accredited nor retail investors with the level of exposure they truly desire. In contrast, Cerebras' IPOP market opened for trading on Hyperliquid two weeks before its official IPO, and the price briefly dipped below $200 in early May, ensuring wider accessibility to the asset. While the core value of these on-chain markets is "providing access," what truly attracts global attention is price discovery. Morgan Stanley, the lead underwriter for this IPO, was observed tracking its price on Hyperliquid before the official listing. On the morning of the listing, Hiive, a major offline platform for accredited investors, gave a valuation of $220. In contrast, TradeXYZ was the only platform at the time to provide real-time pricing for the asset: the price was around $290 that morning, and had risen to around $340 an hour before the Nasdaq opening. Cerebras was TradeXYZ's first IPOP test. After successfully converting to a standard perpetual contract, this contract would follow external oracles to anchor the official price at the opening of traditional markets, and more assets began to be listed on the platform. Among them, SpaceX had already been listed for trading before its target Nasdaq listing date of June 12th. This will be the largest IPO in the coming years, with a offering size more than 30 times that of Cerebras, and potentially the largest IPO in history, even surpassing Saudi Aramco's offering size at a valuation of approximately $1.7 trillion in 2019. Cerebras raised a total of $1.7 billion through five private funding rounds over seven years. However, retail investors previously had virtually no opportunity to participate due to the difficulty of gaining exposure through an IPO. This situation changed with the emergence of IPOP on TradeXYZ. On May 1st, TradeXYZ listed xyz with a reference price of $175, implying a valuation of approximately $48.9 billion. At this current market stage on TradeXYZ, there are no external price influences. This is also the largest valuation increase Cerebras has achieved in such a short period. Essentially, this is the optimal time to leverage perpetual exposure for leveraged trading, all on the Hyperliquid chain. During the 14-day pre-IPO window, XYZ saw a total notional trading volume of $281 million, with almost all of that concentrated on the day of the official listing. In the first 13 days, as price discovery gradually took hold but attention remained limited, the average daily trading volume hovered between $1.5 million and $9.5 million. On May 14th, however, the single-day trading volume exceeded $207 million, accounting for 80% of the total trading volume throughout the market's lifecycle. On the other hand, compared to traditional listed stock markets, the bid-ask spread remained relatively wide, but it narrowed rapidly before the listing. According to Shaun Dadevens, the median bid-ask spread was 61.4 basis points throughout the IPOP period, while the median depth of visibility within 50 basis points of the midpoint was only $2,300. However, both of these indicators showed significant improvement on May 14th, both in anticipation of the Nasdaq opening and after the opening. Even when trading was halted shortly after Nasdaq opened, the TradeXYZ market remained open and quickly realigned its prices with Nasdaq's when trading resumed a few minutes later, maintaining a relatively close pricing relationship with Nasdaq for the next few hours. [Original text in English]
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