Investor Beware: SpaceX Share Frenzy SpaceX Share Frenzy: Investors Must Beware Of Scams Offering Shares In $180 Billion Company – Tesla (NASDAQ:TSLA)

By: Alex Freidmen

The investing world has been abuzz with the electric energy of interest surrounding SpaceX, Elon Musk’s illustrious aerospace firm, reaching an almost deafening crescendo that can drown out the signal in the noise.

The startup is privately held, its shares not laid out for sale via a traditional exchange. Its esteemed shareholders encompass financiers, company executives, and staff.

Speculation suggests that Elon Musk, the CEO of Tesla (TSLA), holds a majority stake, believed to be between a commanding 40-50%.

Private Share Sales Are Possible

For the fortunate few with connections, avenues exist for these insiders to trade shares through SpaceX’s internal trading program. Additionally, platforms cater to private investors seeking to procure shares from these enterprising owners.

One such platform is Rainmaker Securities, boasting a brisk trade of over $4 billion in SpaceX shares, as reported by Barron’s. However, the proviso for Rainmaker’s services is catering exclusively to accredited investors, necessitating a trading license or substantial wealth.

These scenarios are only within reach of a select few, thereby emphasizing that the sale of SpaceX shares remains out of reach for most private investors.

Spin-Off Rumors

Whispers of an imminent initial public offering (IPO) sent tongues wagging. Allegations surfaced in mid-November that Musk was in discussions to spin off SpaceX’s Starlink satellite subsidiary, ushering in a sudden surge of attention.

Musk swiftly quashed these claims, asserting the fallacy of the rumors and reiterating that an IPO would only be entertained once Starlink had satisfied certain financial benchmarks.

Caution rings with each passing day. It seems reminiscent of the cryptocurrency frenzy, where a new coin appeared every other day. During the peak of the 2018 cryptocurrency craze, research by Satis Group found that over 80% of initial coin offerings were scams.

See also  Insightful Quarterly Earnings AnalysisAnticipated Quarterly Reports: Stocks Under the Magnifying Lens

Currently, the fervor encircling anything bearing the Musk or SpaceX imprimatur is attracting a swarm of scammers, exploiting the longing of individuals to partake in a company recently valued at over $180 billion through private sales of its shares.

“A prevalent tactic among online swindlers is to entice victims into a group chat under the guise of an investment opportunity. But it’s all a ruse to abscond with unsuspecting users’ funds,” cautioned Jordan Liles from Snopes, the fact-checking website that has already flagged the surge in SpaceX-related scams.

An instance of a Facebook group purporting to offer a slice of the SpaceX pie was recently sighted by Benzinga and subsequently shared. Though Benzinga cannot independently verify the legitimacy of this offering, the content has since vanished from the platform. The group’s page still features posts on ways to invest in OpenAI and Neuralink, both companies backed by Elon Musk.

Patience is key. A Starlink IPO is likely to materialize. Some analysts opine that it has already achieved the financial objectives set by Musk, rendering Starlink IPO-ready.

Meanwhile, a recent Benzinga article outlined alternative avenues for investors to participate in the burgeoning U.S. corporate space race while awaiting the eventual IPO.

Image: Shutterstock