Any money you put into SpaceX instantly transforms into bitcoin

And some of your money will almost certainly end up there, whether you like it or not.

There’s an easy Hotel California joke in there; your money can check out any time it likes but it can never leave. That’s not the full story, though. The money you invest in SpaceX won’t be going into a black hole, it will be transformed into something that is money-adjacent.

And bitcoin is a pretty good analogy for what it will become.

First though, yes, this means you. To use a more apt space metaphor, the SpaceX IPO will introduce a supergiant star into the local economic neighbourhood. It will be so big, with so much gravity, that it will attract money from almost everywhere. You will not need to choose to invest in SpaceX, SpaceX will get some of your money automatically.

I did some rough mapping of the flows for Britain and South Africa, and fewer rands than pounds will be affected, but other than North Korea, no economy is isolated enough from the USA to not be part of SpaceX. Almost every American (and a lot of European and Asian) tracker and index funds will be forced buyers of SpaceX shares. Almost every bank and insurance company has money that ultimately ends up in one of those funds.

If you have a bank account or insurance, you’ll be exposed to SpaceX to some extent. Even if you don’t, some company you do business with will have a treasury that dumps some money into a pool that will have a tendril that drains into SpaceX. So you only need to shop at a major retailer to be an affected party.

That is true for some other companies too. But none of those giant companies are utterly under the control of a single individual.

The SpaceX prospectus is pretty blunt about it:

Upon completion of this offering, Mr. Musk will serve as our Chief Executive Officer, Chief Technical Officer, and Chairman of our board and control the election of our directors, and our dual class structure concentrates voting control with Mr. Musk and other holders of our Class B common stock. This will limit or preclude your ability to influence corporate matters and the election of our directors.

At IPO, Elon Musk will have more than 80% of the total voting power. He will be constrained in what he does with SpaceX only by the laws and regulations of the United States of America, and has a history of getting away with flouting those. He also has a history of seeking more control over his companies; he isn’t going to be diluting that control, ever, if he can help it.

So your money that goes into SpaceX becomes Elon Musk’s to do with as he pleases. The only thing that can reduce his agency over your money, and the leverage that gives him in the world, is if he chooses to give some of that money back to you.

Spoiler: Elon Musk is never, ever giving any of your money back.

The “NO DIVIDENDS FOR YOU” language in the prospectus is as stark as the control bit.

That is still putting it mildly, though. SpaceX will never pay a dividend as long as Elon Musk is alive.

With no cash return, that makes your (distantly-held) SpaceX shares worth only what someone else will pay for them. Anyone who buys your shares will be doing so in anticipation of what a future buyer will pay for them. It is a pure sentiment play, based entirely on what will be, all the underlying spreadsheets and corporate accounts notwithstanding, a consensual hallicination.

Or, basically, bitcoin.

Money itself is arguably a consensual hallicination. It is often useful to think of it as such. The big difference between money and money-adjacent instruments (such as liquid, publicly traded shares) is that you can use money to pay your tax. The tax that you need to pay lest people with guns come to your door.

There is a possible, if not likely, future in which countries other than El Salvador declare bitcoin legal tender, and it becomes a tax-settlement device. I can’t ever see that happening for SpaceX shares.

Me, I’d rather have the bitcoin.