SpaceX stock tanked to $104.83 on Monday, its lowest point ever. Elon Musk, however, saw opportunity. When an investor posted that the dip would look obvious in hindsight, Musk responded with three words: "I think so." The stock then bounced almost 6% to close at $114.53, though it remains 15% below the $135 IPO price and roughly half its $225.64 record high.

The bigger story is what happens Thursday. Up to 911.5 million shares become tradable on August 6 as employee and backer lock-ups expire. At Monday's closing price, that block is worth around $104 billion, roughly 1.4 times the entire volume trading today.

The Lock-Up Trap

Most SpaceX shares are frozen. The company has 13.2 billion shares outstanding, but fewer than 639 million can actually be bought or sold right now, under 5% of the total. The rest sits with employees and early investors who agreed not to sell immediately after the IPO in August 2026.

The initial unlock on Thursday represents the first major crack in that wall. Around 20 to 30% of locked shares become eligible initially, with staggered unlocks bringing tradable shares to roughly 40% by December. A second batch of 455.8 million shares only unlocks if the stock hits $175.50, which it never has come close to.

More waves hit later in the year. Musk himself stays locked until June 2027 and controls about 82% of voting power, so his shares won't flood the market yet.

Shorts Are Already Positioned

Traders have been reading the calendar. Short bets jumped to 165 million shares from 111.3 million two weeks ago, now representing a quarter of everything tradable. The stock slid all of July despite new launch deals and a mostly successful Starship test, signaling that sentiment has already turned sour.

Musk's public backing and the stock's Monday bounce offer some hope, but the math is brutal. Insiders holding $104 billion worth of shares gain the ability to cash out starting in three days, right as earnings land Tuesday. That timing could matter.

This article is informational and does not constitute investment advice. Past performance and stock prices do not guarantee future results.