U.S. Senator seeks to delay SpaceX IPO: index funds will be forced to buy in at high prices, initial market value severely overestimated

BlockBeats News, June 10, according to CNN reporter Matt Egan, the Vice Chair of the Senate Democratic Caucus, Elizabeth Warren, has officially made public a letter to SEC Chair Paul Atkins, requesting a delay of SpaceX’s IPO. The reasons cited are:

There are doubts about SpaceX’s valuation, which may be seriously overestimated;

The company’s corporate governance structure has flaws, and investor protection is insufficient;

Recent changes to index fund rules will mean that after SpaceX goes public, it will be quickly added to major indices, forcing passive funds to take on shares at high prices;

The addition of the index will systematically transmit valuation risks to millions of retirement savings accounts;

This IPO poses significant risks to ordinary investors and retirement savings;

The IPO structure brings substantial benefits to insiders at SpaceX, with an unfair distribution of interests;

The market environment is not normal, and multiple factors further aggravate the risks;

The SEC must fulfill its statutory duties to protect investors and maintain market integrity, and delaying the IPO is a necessary measure.

For a breakdown of more viewpoints questioning the SpaceX IPO, see “SpaceX IPO Approaching: A Century Harvest Hidden in Index Funds.”