CXMT crypto contract points to a $425 billion valuation before Shanghai IPO
A pre-IPO derivative tied to China’s ChangXin Memory Technologies is trading far above the chipmaker’s official listing valuation.
By Jordan Bell · Startups & Deals Reporter
· 3 min read
A crypto-linked contract is putting ChangXin Memory Technologies at a valuation that would top every mainland-listed Chinese company before the chipmaker has even started trading in Shanghai. For everyday investors, the gap shows how restricted access to a hot IPO can create a separate, speculative market that may not match the stock’s real opening price.
CNBC reported that a CXMT-linked perpetual futures contract on Hyperliquid traded near $6.35 a share on Thursday, after recently reaching $8.60. A perpetual futures contract is a derivative, meaning traders are betting on the price of an asset without owning the underlying shares. Unlike regular futures, it has no set expiration date.
At Thursday’s level, CNBC reported, the contract implied a market value of about $425 billion, or roughly 2.9 trillion yuan. That would put CXMT ahead of Industrial and Commercial Bank of China, which CNBC said is the largest mainland-listed company at about 2.56 trillion yuan.
The official IPO price is far lower. According to a Shanghai Stock Exchange filing cited by CNBC, CXMT’s offering price was set at 8.66 yuan, or $1.28, per share. That price values the company at 579 billion yuan at listing, which CNBC said would still make it the largest IPO in the history of Shanghai’s tech-focused STAR Market.
Access is shaping the price
CNBC reported that the contract is offered by crypto startup Trade.xyz on Hyperliquid, a decentralized derivatives exchange. The market has drawn offshore investors because CXMT’s Shanghai listing is effectively closed to foreign buyers, according to CNBC. Mainland retail investors also face limits on STAR Market access, including a 500,000 yuan account balance and two years of trading experience.
Eric Chen, co-founder and chief executive of Web3 finance firm Injective Labs, told CNBC that the contract is less a direct valuation of CXMT and more a signal of where traders think the stock could open. Chen said Chinese IPO pricing, a limited initial float, meaning the number of shares available to trade at first, and few easy ways to bet against the stock can push the contract toward the views of the most bullish participants.
“Part of the premium is a forecast,” Chen told CNBC. “Part of it is simply what the world will pay for exposure it can’t get directly in the equities market.”
CXMT is the world’s fourth-largest maker of DRAM memory chips, according to CNBC. Its listing comes during a strong cycle for memory pricing, helped by demand tied to artificial intelligence and a global supply shortage. CNBC reported that the company is set to raise up to $8.6 billion, which would make it Asia’s largest IPO this year.
Hyperliquid faces closer attention
The trading has also put Hyperliquid under scrutiny. CNBC reported that the Monetary Authority of Singapore added the platform to its Investor Alert List in June. The list notifies the public that an entity is not licensed or authorized in Singapore. Hyperliquid said the listing was not a ban or enforcement action and that it has not claimed to be regulated by the MAS, according to CNBC.
CNBC also reported that Kyle Samani, co-founder of Multicoin Capital and chair of Forward Industries, challenged Hyperliquid’s claim that it is permissionless, pointing to closed-source code and a concentrated validator set. Hyperliquid did not respond to CNBC’s request for comment.
Past pre-IPO derivatives on Hyperliquid have had mixed results. Tanay Ved, a senior research associate at Coin Metrics, wrote in a report cited by CNBC that Hyperliquid’s Cerebras Systems contract settled within about 1.3% of the stock’s Nasdaq opening price. CNBC said its SpaceX contract traded roughly 20% above a fixed $135 offer price before a June debut, after peaking above $220 in May.
Chen told CNBC that once CXMT begins trading, the derivative should reset around the actual Shanghai price. If the stock opens below the contract, he said the repricing could be immediate; if local demand is strong, prices could rise further.
This story draws on original reporting from CNBC.
