Blofin Research: Will The Spacex Ipo Pop The U.s. Stock Bubble?

What Happened

On the way up. Investors buy call options aggressively. The dealers on the other side of those trades hedge their exposure by buying the underlying stocks. That buying pushes prices higher, which encourages more call buying, which forces dealers to buy still more stocks. The rally starts fueling itself, driven not by news or earnings but by hedging flow.

Market Context

The S&P 500 just crossed 7,400 for the first time, AI memory names have multiplied severalfold in months, and the most anticipated IPO of the cycle is approaching. Beneath the surface, the options market is flashing two opposite signals at once. Crypto’s quiet weakness may already be pricing something, and there are two scenarios for when the bubble pops worth watching closely.

But the rally is narrow. In one recent record-high session, just five mega-cap names contributed roughly three quarters of the S&P 500’s gain. AI has become the market’s entire center of gravity.

Into this market, SpaceX is preparing to IPO, with market speculation pointing toward summer 2026 and valuation discussions already in trillion-dollar territory. The listing packages AI, space, Elon Musk and future infrastructure into a single deal.

When the market begins treating an unlisted company as a “must own” global asset, risk appetite has already shifted from distributed to concentrated. An IPO of this scale will absorb enormous market liquidity, making it the most concentrated stress test this cycle has faced.

What the Options Market Is Telling Us

The current rally is not only driven by earnings or AI optimism. It is also being amplified by the structure of the options market itself.

Cboe data shows that in single-stock equity options, call volume reached 3,695,561 while put volume was 1,954,735, with a put/call ratio of just 0.53.

Bullish call volume is now nearly twice the bearish put volume. Speculative positioning in individual stocks is heavily skewed to the upside.

On the way down. The reverse runs just as hard. Once prices stop rising, those crowded calls quickly lose value. Dealers no longer need as much protection and begin selling the stocks they had bought. That selling can accelerate the decline. The same positioning that built the rally can dismantle it.

A heavily call-skewed market looks stable on the way up. It tends to be fragile in both directions.

But the picture changes at the index level. SPY options show call volume of 4,030,087 versus put volume of 5,271,270, with a put/call ratio of 1.31. QQQ tells the same story, with a put/call ratio of 1.32.

This divergence is the real warning. Speculative traders are still chasing upside in individual stocks. Meanwhile, broader portfolio hedging demand at the index level is already rising. The surface of the market still looks euphoric. The institutional hedging layer is becoming more defensive.

For crypto, the question is not whether a U.S. equity correction would matter. It would. The real question is whether Bitcoin has already started to price it in.

October 2025, 19 billion dollars in leveraged crypto positions liquidated within roughly 24 hours, one of the largest liquidation events in crypto history. Crypto has already gone through a leverage reset. U.S. equities, by contrast, may still be building one through the options market.

While U.S. indices keep printing new highs, crypto markets remain well below their previous euphoric levels. Read another way, the 24/7 crypto market may already be pricing tighter liquidity, weaker risk appetite and a possible cross-asset reset.

Scenario 1: The summer liquidity drain. Bitcoin is working its way toward the $84,000 CME futures gap. If that technical rebound completes around the same window the SpaceX IPO comes to market, the two events would intersect in early-to-mid summer 2026.

Why It Matters

Why Bitcoin May React First, and Recover First

Details

U.S. equities are in a vertical phase. The S&P 500 just broke 7,400 for the first time, up roughly 27% over the past twelve months and more than 15% in a six-week stretch. The Nasdaq-100 has gained close to 40% over the same year, and April 2026 alone delivered its strongest monthly performance in 23 years.

That gravity has spread through the supply chain. SanDisk has gained more than 510% year-to-date and nearly 4,000% since its 2025 spinoff from Western Digital, while Western Digital itself is up roughly 190% year-to-date and Micron close to 170%. Multi-hundred to multi-thousand percent moves compressed into months exceed what structural growth can explain.

This matters because options positioning can amplify the moves it tracks. Here is how the feedback loop works.

In both major ETFs, puts are now meaningfully more active than calls.

Combined with the AI valuation extremes already in motion, the equity rally is no longer just being driven by earnings or narrative. It is being amplified by a positioning structure that magnifies upside, and can magnify downside just as quickly.

Two Scenarios for When the Stress Hits