In a blender, combine frozen and fresh watermelon and half the jalapeno. Blend until you don't see any jalapeño left.
Strain mixture and discard pulp. Add lime juice and simple syrup and stir to combine.
To make the salted rims, combine salt and cayenne powder in a wide flat bowl. Use a wedge of lime and run it around the edge of the glass, then dip the wet edges into the spicy salt.
Pour glasses 2/3 full with mixture then top off with sparkling water. Garnish with a jalapeño coin and watermelon wedge and serve!