Private companies don’t need to issue shares for traders to speculate on their valuations. That’s what makes pre-IPO perpetuals different from tokenized equities. Take a private company like Anthropic. A perpetual market can offer price exposure to its estimated valuation without the exchange holding Anthropic shares or having access to its shareholder register. Here’s how the structure works. … α/ Reference Valuation The contract needs a benchmark. Depending on the venue, that might come from private-market transactions, external valuation estimates or a market-derived index. Because there’s no continuously traded public stock, the quality of this reference is critical. β/ Mark Price The venue calculates a mark price used to determine unrealized profits, losses and liquidation risk. This may differ from the latest traded contract price to reduce manipulation from isolated trades. γ/ Funding Payments Perpetual contracts have no fixed expiration. Periodic funding payments between longs and shorts help manage differences between the contract price and its reference. The exact funding mechanism depends on the exchange. δ/ Collateral and Margin Traders deposit collateral, often stablecoins, to open positions. The exchange records their exposure and margin requirements, but no private shares change hands. A $10,000 long position with $2,000 collateral represents 5x exposure to the contract’s price movement, not $10,000 of equity ownership. ε/ Liquidation If the mark price moves against the trader and their margin falls below the required maintenance level, the exchange can liquidate the position. This happens entirely within the derivatives system. ζ/ Financial Settlement When a trader closes a position, the venue calculates the difference between entry and exit prices. Profits and losses are credited or debited through the venue’s settlement system. The trader receives no company shares. > No ownership transfers. > No voting rights. > No shareholder registration. And unless the contract explicitly provides otherwise, an eventual IPO doesn’t automatically convert the perpetual into public equity. … The entire structure separates price exposure from legal ownership. A private company’s valuation becomes something traders can take long or short exposure to, while the actual shares remain outside the derivatives market. The critical question is how reliably the venue can price that exposure when the underlying equity has no continuous public market.