“There is no major negative fundamental catalyst that we can see,” Dorman said. “These types of big moves are common after SPACs because the entire investor base shifts from fixed income-oriented SPAC buyers to fundamentally driven new long-term equity owners.”
SPAC merger tickers are typically volatile in their first few days of trading. These vehicles raise money first and pursue an acquisition later, allowing a private company to reach the public market by merging with the shell company. But once the deal closes, the investor base often changes: SPAC arbitrage investors and bailout-focused holders give way to public equity investors weighing the company’s fundamentals. That transition can create wild price swings, particularly when the float is limited or the stock had been trading higher before the merger.
Crypto IPO hangover
Dorman added that the poor performance of recent cryptocurrency-related stock prices has conditioned investors to be cautious.
“Given how horrible the recent cryptocurrency IPOs have been – Coinbase (COIN), Bullish (BLSH), Gemini (GEMI), BitGo (BTGO) and Circle (CRCL) – it’s not that surprising,” Dorman said.
Since its IPO in February, digital asset service provider and custodian BitGo has fallen 70%. Gemini, the crypto exchange founded by the Winklevoss brothers, is down 85% since its debut in September. Bullish, the owner of CoinDesk, has fallen more than 70% from its debut price of $90 in August 2025, and is below its IPO price of $37.
