Issuance Surge Meets a Market-Structure Inflection

The US equity-issuance machine is running harder than it has in years. The question is whether the plumbing underneath it can keep pace.

Three forces are converging at once: a record-breaking IPO pipeline, the SEC’s proposal to rescind the core trade-through rule that has governed equities routing for two decades, and the staggered lockup expiration of the largest IPO in history. Each is significant on its own. Together they mark an inflection — one where the direction is fairly clear but the timing and magnitude of the transition are genuinely uncertain.

The Issuance Boom by the Numbers

The SEC’s Division of Economic and Risk Analysis confirmed in a July 1 release that the first quarter of 2026 saw 99 IPOs raising over $22 billion, an approximately 86% increase in proceeds compared to the 84 IPOs and $11.8 billion raised in Q1 2025.^[1] Follow-on registered offerings also grew — 264 deals raising over $44.2 billion in Q1 2026, up from 250 deals and $40.4 billion the prior year.^[1]

PwC estimated that H1 2026 US IPO proceeds topped $114 billion, with SpaceX’s listing leading the surge.^[2] Goldman Sachs strategists projected in February that US IPO proceeds could quadruple to a record $160 billion for the full year, with deal counts rising to roughly 120 listings — nearly double 2025 levels.^[2]

Morgan Stanley’s equity capital markets team, in a May report, framed the environment as a structural reopening: global issuance rose 43% year-over-year to $256.8 billion in Q1, while IPO volumes increased 40% to $45 billion. The pipeline is skewing larger and later-stage, reflecting years of private capital formation. Financial sponsors are central — PE-backed IPOs represented roughly a third of US listings in recent periods, and sponsor-backed IPO issuance reached $12.8 billion in Q3 2025 alone, the strongest quarter since 2022.^[3]

The themes driving demand are concentrated: AI infrastructure ecosystems and aerospace/defense spending. But the breadth has been widening into real estate, healthcare, metals and mining, and consumer retail.^[3]

The Immediate IPO Calendar

The near-term deal book tells the story:

Source: StockAnalysis.com IPO Calendar^[4]

Jersey Mike’s is the standout. Blackstone-backed and targeting up to $1.09 billion in proceeds, the sub sandwich chain plans to list on the NYSE under the ticker JMKE with a valuation that could reach approximately $7.9 billion — almost exactly what Blackstone paid to take control less than two years ago.^[5] Axios noted that the deal is being watched as a signal for whether a “feast of restaurant IPOs could follow,” with Inspire Brands (Dunkin’, Arby’s) reportedly eyeing the public markets on the heels of a successful Jersey Mike’s reception.^[5]

Most of the stock changing hands in the Jersey Mike’s offering is not new money for the company — it is selling stockholders (primarily Blackstone and the Abu Dhabi Investment Authority) monetizing. Only about 13.8 million of the 43.5 million shares offered are new issuance, with the roughly $301 million in proceeds earmarked for debt paydown.^[5] That matters: it makes this deal a liquidity event for private shareholders more than a capital-raising event for the business, and it puts the absorption question front and center.

Scribe Therapeutics (SCTX), pricing the same week, is a smaller, more conventional biotech IPO — 7.15 million shares at $13–$15 on Nasdaq, targeting roughly $100 million at a ~$227 million market cap with $36.3 million in revenue.^[4] Reformation (REF), the sustainable fashion brand, is targeting $225 million on the NYSE at a ~$945 million market cap with $533 million in revenue.^[4]

The Follow-On and ATM Pipeline

Secondary and follow-on issuance is running alongside the IPO wave. Recent deals include:

• Dyne Therapeutics (DYN) — priced an upsized $375 million public offering of common stock on July 21, a clinical-stage neuromuscular disease company tapping the market for development funding.^[6]
• Rackspace Technology (RXT) — filed an at-the-market equity distribution agreement with Goldman Sachs for up to $250 million in common stock, effective July 9.^[6]
• REGENXBIO (RGNX) — announced a $100 million underwritten offering on July 16.^[6]
• Dollar Tree (DLTR) — announced a secondary block trade by selling stockholders alongside a concurrent share buyback, with the company repurchasing a portion of the shares being sold.^[6]
• BrightSpring Health Services (BTSG) — 15 million existing shares sold in a secondary by KKR affiliates and management, with no new shares issued and a concurrent buyback.^[6]

The pattern across these deals — secondary sales paired with concurrent repurchases — is worth noting. It is a structure that lets insiders exit while the company absorbs a portion of the supply, effectively using the corporate balance sheet as a partial buyer of last resort. When this pattern spreads, it often signals that sellers are uncertain the market can absorb their full position organically.

The SEC’s Reg NMS Rescission Proposal

Beneath the issuance volume, the regulatory foundation of how equities trade is under active revision. On June 11, 2026, the SEC proposed to rescind Rule 611 (the trade-through prohibition) and Rule 610(e) (the restriction on locked and crossed quotations) of Regulation NMS.^[7] The public comment period closes August 17.^[8]

Chairman Paul Atkins framed the proposal as correcting two decades of unintended consequences: “After two decades of Rule 611, it is high time that the Commission review its unintended consequences that have hindered — rather than enhanced — the long-term growth of our markets. This proposal is intended to simplify market structure and reduce costs for market participants while allowing competition, innovation, and other market forces to shape the continuing evolution of our equity markets.”^[7]

Commissioner Hester Peirce supported the proposal, arguing that technological advances have rendered the rules “unnecessary, if they ever were necessary.”^[9] Commissioner Mark Uyeda called it “an important beginning in the broader, more complex journey of reforming the Commission’s equity market-structure rules.”^[9]

The trade-through rule, enacted in 2005, requires brokers to route orders to the venue displaying the best price, even if a competing exchange or dark pool offers a faster fill at an inferior price. If rescinded, execution speed and venue economics would gain weight relative to price priority in routing decisions — a fundamental change to how every traded stock in the US clears. The locked-and-crossed-market ban, which prevents venues from displaying quotes that overlap, would also be lifted, potentially allowing more competition among venues but also more fragmentation.

What would have to be true for the bull case: that modern technology — faster data feeds, better smart-order routers, and the rise of competitive venues — makes mandatory best-price routing redundant. The rule’s cost is real: compliance infrastructure, latency penalties, and constrained competition among trading venues. If market participants can self-optimize routing more efficiently than the rule mandates, the rescission would lower systemic friction.

What would have to be true for the bear case: that without a regulatory floor on price protection, retail and smaller institutional orders end up routed to venues that are faster or more profitable for the broker but not the best-priced — a return to the internalization and payment-for-order-flow tensions the rule was designed to mitigate.

I would put the probability of final adoption at roughly 60% within 12 months, with meaningful modification likely after the comment period. The direction of travel — deregulation under the current Commission — is clear, but the specifics of what replaces Rule 611 matter enormously.

The Texas Stock Exchange Goes Live

The same week the SEC proposed to tear up Reg NMS, the newest national securities exchange in decades began live trading. The Texas Stock Exchange (TXSE), based in Dallas, commenced quoting and trading on July 6, 2026, with designated test securities, and moved to live trading in five National Market System securities on July 10.^[10] All NMS symbols are expected to be available on TXSE in the coming weeks as the phased rollout continues.^[10]

TXSE received SEC approval on September 30, 2025, and has been building toward full production launch since.^[10] The exchange is positioning itself as a more business-friendly listing venue, competing with NYSE and Nasdaq for corporate listings and trading volume — particularly for Texas-based and energy-sector companies.

The timing is not incidental. If Rule 611 is rescinded, a new venue competing for order flow gains more latitude to differentiate on speed and cost rather than being forced to route to the best-priced venue. More venues also means more fragmentation — and more demand on smart-order routers to find the best execution across a widening landscape.

The SpaceX Lockup: The Largest Absorption Test in History

The numbers are staggering. Former Nasdaq CEO Robert Greifeld, in a July 6 CNBC interview, warned that roughly $800 billion in SpaceX shares could become tradeable between now and the end of October — what he called the largest lockup expiration in US capital markets history.^[11]

SpaceX priced its IPO at $135 per share at a $2 trillion valuation, with only 4.9% of shares freely tradable at the offering.^[12] The lockup structure is not a standard 180-day cliff — it is a staggered design with 16 separate unlock dates, releasing 20% after the first earnings report, an additional 10% if the stock trades at least 30% above the IPO price (i.e., above $175), and 7% unlocks at each subsequent post-IPO interval on a rolling schedule.^[12]

SpaceX shares are already down approximately 33% from their post-IPO record close heading into August.^[12] That matters for two reasons. First, the $175 price trigger for the additional 10% unlock is meaningfully above the current trading range — if the stock does not recover to that level, the extra supply stays locked. Second, Greifeld’s core concern is about who becomes supply first: early private-market backers sitting on 20x returns may be “price-insensitive sellers,” meaning they are selling for liquidity reasons rather than market views.^[11] On a stock with only 4.9% free float at IPO, even modest selling from this group has an outsized price impact.

Greifeld also argued that SpaceX should be added to major indexes as quickly as possible, noting that “the rules did not contemplate a company that had been around for 23 years that would be worth $2 trillion.”^[11] Passive inflows from index inclusion could offset some of the supply pressure, but index additions follow their own eligibility timelines and typically lag the lockup calendar by months.

Here is where I would put the probabilities:

• Base case (55%): SpaceX’s staggered lockup design works as intended — supply drips rather than floods, the stock absorbs initial tranches with moderate volatility, and the market clears without a disorderly break. The 33% drawdown from the high already prices in a meaningful portion of the lockup risk.
• Bearish case (30%): Price-insensitive sellers concentrate at the early unlock dates, the stock fails to reclaim $175, and each subsequent tranche lands into weakening demand. The 7% rolling unlocks compound into a multi-month grind rather than a single repricing event.
• Constructive surprise (15%): The stock rallies above $175 into the first earnings unlock, triggering the additional 10% supply — but demand absorbs it, index inclusion accelerates, and the larger float eventually improves liquidity and narrows spreads. In this scenario, the unlock becomes a net positive.

The key signal is binary and observable: does SPCX close above $175 after its first post-IPO earnings report? If yes, the additional 10% tranche unlocks and the market’s ability to absorb it will be the clearest demand test of the year. If no, the supply wave is smaller but the price signal is weaker.

What to Watch Next

1. Scribe Therapeutics (SCTX) pricing — July 24: The first deal on the immediate calendar. A clean pricing at the midpoint or above would signal that risk appetite for smaller, pre-revenue biotech is intact; a cut to the range or postponement would be a yellow flag for the broader calendar.

2. Jersey Mike’s (JMKE) pricing — July 30: The largest consumer IPO of the near-term calendar, and the one with the most secondary-supply structure. If the deal prices in range and trades well in the aftermarket, it opens the door for more restaurant and PE-backed consumer listings. If it prices below range or breaks issue price on day one, it cools a key sector pipeline.

3. SpaceX (SPCX) first post-IPO earnings report — expected August: The $175 trigger is the single most important price level to watch. Above it, the additional 10% unlock activates and the absorption test begins in earnest. Below it, the supply wave is smaller but the signal about demand is bearish.

4. SEC Reg NMS comment deadline — August 17: The comment window closes. Watch for whether major broker-dealers, exchanges, and investor advocates push back hard enough to force modifications, or whether the proposal moves toward adoption largely intact.

5. TXSE full symbol rollout — through August: As TXSE adds all NMS symbols, watch for volume migration and whether the new venue captures meaningful market share, particularly from NYSE-listed names. This matters more if Rule 611 is rescinded.

6. Follow-on and secondary flow: If the pattern of secondary sales paired with concurrent buybacks (DLTR, BTSG, Navigator Gas, ADT) continues to spread, it suggests that selling shareholders are hedging their bets on market absorption capacity — a quiet indicator worth monitoring.

The simplest way to frame the setup: 2026 is a year of record supply meeting a market-structure redesign. The IPO pipeline is robust, the SEC is loosening the regulatory scaffolding that has governed equities routing for two decades, and a new exchange is entering the competitive mix. Each of these is a positive development in isolation. The risk is in the interaction effects — whether the system can absorb $800 billion in SpaceX lockup supply, 120-plus new IPOs, and a wave of follow-on issuance all while the routing rules underneath are being rewritten. History suggests the market adapts. The question is always how much it costs to get there.