Chinese investors are using digital assets to circumvent Beijing’s capital controls and simulate investments in hot US IPOs such as SpaceX and OpenAI, despite concerns the securities may not be legitimate.
The investments rely on “tokens”, digital assets offering synthetic or purportedly asset-backed exposure to the underlying stocks. Chinese investors are funding the trades by buying stablecoins such as USDT with renminbi, in spite of Beijing’s ban on converting fiat money into cryptocurrency.
Demand from Chinese investors for the investment products has surged, with some offerings heavily oversubscribed, according to industry participants. The rush has been so intense that many Chinese investors have bought in without confirming they are backed by actual shares or whether the companies recognise the transactions as equity investments.
The manoeuvres highlight the lengths to which ordinary Chinese investors are willing to go to get exposure to high-profile western investments despite the risks.
“A lot of people are paying for promises that they won’t be able to enforce,” said Timothy Spangler, a Los Angeles-based partner at law firm Practus who specialises in cryptocurrency-related cases.
The influx of Chinese capital into token-based investments has come as valuations of these companies have soared.
SpaceX is seeking a valuation of about $1.78tn in its initial public offering, according to its IPO filing, after surging from $137bn in early 2023 to $800bn in late 2025. OpenAI, which confidentially filed paperwork with US regulators on Monday for an IPO, has seen its valuation jump 29-fold over a similar period.
The boom has also coincided with Beijing’s tightening grip on cross-border investing. That has made token-based investment products a workaround.
Chinese investors buy stablecoins on offshore platforms such as Binance, which is blocked in China but remains accessible through virtual private networks that allow users to bypass internet restrictions. Such purchases can exceed China’s $50,000 annual foreign exchange quota for individuals.
An adviser to China’s central bank said regulators had sought to curb stablecoin conversions but enforcement remained limited because the transactions were difficult and costly to police.
A spokesperson for Binance said the company’s services “follow and are in accordance with our global regulatory practices which provide clear eligibility restrictions, product disclosures and operational control”.
Chinese investors then use the stablecoins to buy tokens on crypto platforms offering varying forms of exposure to private companies. Some are marketed as being linked to special purpose vehicles that hold shares in the underlying companies. Others are synthetic instruments such as perpetual contracts that track the implied value of the companies without giving holders any claim on their equity.
Paimon Finance, a New York-based crypto investment platform, has launched two tokenised investment products since 2025 that it says provide exposure to SpaceX and OpenAI.
Liu Guyan, Paimon’s co-founder, said the company acquired the exposure through special purpose vehicles, adding that such deals had “some barriers” but were “not as difficult as people imagine”.
“After working on Wall Street for a while you know the people buying and selling these things,” he said, adding that he had “many” Chinese-speaking clients.
Bitget, a major crypto exchange registered in Seychelles, in April launched preSPAX, a tokenised product that it said would track SpaceX’s equity performance, though its terms state that the product is not a direct investment in SpaceX.
A sizeable portion of the 14,435 investors who bought preSPAX came from China, the world’s second-largest economy, people with knowledge of the matter said.
Samuel Xie, an investor based in the south-western city of Chengdu, said the preSPAX sale was so heavily subscribed that he received only 0.019 units, worth about $12 at Bitget’s subscription price of $650 per unit.
“Unless retail investors can get into pre-IPO bets backed by real-world assets,” he said, referring to Bitget’s SpaceX-linked preSPAX token, “ordinary people have almost no chance of accessing these opportunities”.
Bitget said the company “does not provide these products to users in prohibited jurisdictions or jurisdictions where users are not permitted to partake in such investments — including, but not limited to, mainland China”.
Some of these bets have paid off. Brendan Li, an investor in Hubei, said he had spent more than $12,000 in May buying an OpenAI-linked pre-IPO product on MSX, a crypto exchange, and sold the position two weeks later for a 32 per cent gain.
The investment boom, however, has come with significant risks. It is difficult for Chinese investors to verify whether the SPV or token product they are buying is actually backed by shares in the underlying US technology start-up. Even if it is, many companies restrict secondary transfers of their shares and can deem unauthorised transactions void.
OpenAI said in July 2025 that it did not endorse or participate in tokenised contracts that track the private-market prices of the company and warned that unrecognised sales could carry “no economic value” to buyers. Anthropic said in a statement in May that it did not permit SPVs to acquire its stock and that unapproved transfers would not be recognised on its books.
The risks are even greater for tokenised products that merely track the private-market prices of companies without any claim on the underlying shares.
Timothy Wang, an investor in the central province of Hunan who last month spent more than $20,000 buying OpenAI-linked token products on MSX, said it was “unrealistic to check all the paperwork, not to mention that the token issuer may not allow investors to review it”.
Wang said OpenAI’s valuation had already reached an “overheated” level, adding that he would “get out” once the company goes public.
“At a time when Chinese financial markets have had somewhat uneven performance, the desire for Chinese investors to diversify their portfolios, and to ride on the coattails of the US technology-related equity boom is certainly a very attractive proposition,” said Eswar Prasad, a professor at Cornell University. “Tokenised investment is going to create a lot of opportunities, but it’s going to create some significant risks as well.”
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