The convertible notes will be sold to institutional investors in a private offering.
The proceeds will be used to repay debt and other general corporate purposes.
Coinbase (Nasdaq: COIN), the largest cryptocurrency exchange in the United States, is planning to raise $1 billion through the issuance of convertible senior notes. Announced yesterday (Tuesday), the proceeds will be utilized to repay debt and other general corporate purposes.
Investors React to the Bond Sale
The company is avoiding the sale of its equity, which could hurt its stock prices. However, the publicly-listed stock prices of the company dropped more than 1 percent after hours following the announcement of the convertible bond issuance.
The exchange will sell the convertible notes through private offerings only to institutional investors. The convertible notes will have a maturity date in 2030 and will allow the investors to redeem them in cash or Class A shares of the company or in a combination of both.
Furthermore, the San Francisco-headquartered exchange expects to grant a 30-day option to purchase up to an additional $150 million notes to cover over-allotments.
The debt the exchange wants to repay with the planned convertible notes is outstanding: 0.5 percent convertible senior notes due in 2026, 3.375 percent senior notes due in 2028, and 3.625 percent senior notes due in 2031. The general corporate purpose to be fulfilled by the proceeds from the convertible notes might include “working capital and capital expenditures, and to pay the cost of the capped call transactions.”
“Coinbase may also use a portion of the net proceeds to make investments in and acquisitions of other companies, products, or technologies that Coinbase may identify from time to time,” the exchange noted.
The MicroStrategy Playbook
Coinbase’s plan to issue the convertible notes echoes a model mastered by MicroStrategy, a business analytics company known for its massive Bitcoin investment. Under the leadership of Michael Saylor, MicroStrategy purchased 205,000 Bitcoin worth around $15 billion over the years by raising about $2 billion through convertible notes. MicroStrategy sold $700 million worth of convertible notes.
Coinbase's decision came when the cryptocurrency market witnessed a massive bullish sentiment. Bitcoin is trading at an all-time-high value, nearing $73,000 a piece.
Coinbase (Nasdaq: COIN), the largest cryptocurrency exchange in the United States, is planning to raise $1 billion through the issuance of convertible senior notes. Announced yesterday (Tuesday), the proceeds will be utilized to repay debt and other general corporate purposes.
Investors React to the Bond Sale
The company is avoiding the sale of its equity, which could hurt its stock prices. However, the publicly-listed stock prices of the company dropped more than 1 percent after hours following the announcement of the convertible bond issuance.
The exchange will sell the convertible notes through private offerings only to institutional investors. The convertible notes will have a maturity date in 2030 and will allow the investors to redeem them in cash or Class A shares of the company or in a combination of both.
Furthermore, the San Francisco-headquartered exchange expects to grant a 30-day option to purchase up to an additional $150 million notes to cover over-allotments.
The debt the exchange wants to repay with the planned convertible notes is outstanding: 0.5 percent convertible senior notes due in 2026, 3.375 percent senior notes due in 2028, and 3.625 percent senior notes due in 2031. The general corporate purpose to be fulfilled by the proceeds from the convertible notes might include “working capital and capital expenditures, and to pay the cost of the capped call transactions.”
“Coinbase may also use a portion of the net proceeds to make investments in and acquisitions of other companies, products, or technologies that Coinbase may identify from time to time,” the exchange noted.
The MicroStrategy Playbook
Coinbase’s plan to issue the convertible notes echoes a model mastered by MicroStrategy, a business analytics company known for its massive Bitcoin investment. Under the leadership of Michael Saylor, MicroStrategy purchased 205,000 Bitcoin worth around $15 billion over the years by raising about $2 billion through convertible notes. MicroStrategy sold $700 million worth of convertible notes.
Coinbase's decision came when the cryptocurrency market witnessed a massive bullish sentiment. Bitcoin is trading at an all-time-high value, nearing $73,000 a piece.
Arnab is an electronics engineer-turned-financial editor. He entered the industry covering the cryptocurrency market for Finance Magnates and later expanded his reach to forex as well. He is passionate about the changing regulatory landscape on financial markets and keenly follows the disruptions in the industry with new-age technologies.
Why is Dogecoin (DOGE) Down Today? Memecoin Faces Tough Conditions as Market Struggles
Executive Interview with Adam Saward | EC Markets | FMLS:24
Executive Interview with Adam Saward | EC Markets | FMLS:24
Executive Interview with Adam Saward | EC Markets | FMLS:24
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Executive Interview with Adam Saward | EC Markets | FMLS:24
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Executive Interview with Johnny Khalil | Tickmill | FMLS:24
Executive Interview with Johnny Khalil | Tickmill | FMLS:24
Executive Interview with Johnny Khalil, Executive Director at Tickmill during FMLS:24
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Executive Interview with Johnny Khalil, Executive Director at Tickmill during FMLS:24
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How Modern Consumer Habits Are Transforming Global Payments
How Modern Consumer Habits Are Transforming Global Payments
The evolution of consumer expectations is reshaping the payments sphere worldwide. From seamless in-store purchases to instant cross-border transfers, the demand for secure and frictionless payment solutions is transforming how businesses and financial institutions approach transactions. But what does this mean for the future of payments, and how can organizations keep up?
On December 4, 2024, Finance Magnates, in partnership with @Visa Direct, hosted a live webinar dedicated to exploring these pressing questions. Industry experts will provided actionable insights into the trends, challenges, and opportunities in global payments, equipping attendees with the tools they need heading into 2025.
DISCLAIMER:
The views and opinions expressed in this webinar are those of the speakers and do not necessarily reflect the views or positions of any entities they represent (including, but not limited to their respective parent companies or affiliates). The views and opinions expressed are based upon information the speakers consider reliable and are intended for informational purposes only and should not be relied upon for operational, marketing, legal, technical, tax, financial or other advice. No party (speaker or the entities they represent) makes any warranty or representation as to the completeness or accuracy of the information within this webinar, nor assumes any liability or responsibility that may result from reliance on such information. The information contained herein is not intended as investment or legal advice, and readers are encouraged to seek the advice of a competent professional where such advice is required.
#FinanceMagnates #VisaDirect #GlobalPayments #FutureOfPayments #PaymentsInnovation #CrossBorderPayments #SecurePayments #SeamlessTransactions #FinancialInsights #PaymentsTrends #WebinarRecap #BusinessFinance #DigitalPayments #FintechInsights #Payments2025
The evolution of consumer expectations is reshaping the payments sphere worldwide. From seamless in-store purchases to instant cross-border transfers, the demand for secure and frictionless payment solutions is transforming how businesses and financial institutions approach transactions. But what does this mean for the future of payments, and how can organizations keep up?
On December 4, 2024, Finance Magnates, in partnership with @Visa Direct, hosted a live webinar dedicated to exploring these pressing questions. Industry experts will provided actionable insights into the trends, challenges, and opportunities in global payments, equipping attendees with the tools they need heading into 2025.
DISCLAIMER:
The views and opinions expressed in this webinar are those of the speakers and do not necessarily reflect the views or positions of any entities they represent (including, but not limited to their respective parent companies or affiliates). The views and opinions expressed are based upon information the speakers consider reliable and are intended for informational purposes only and should not be relied upon for operational, marketing, legal, technical, tax, financial or other advice. No party (speaker or the entities they represent) makes any warranty or representation as to the completeness or accuracy of the information within this webinar, nor assumes any liability or responsibility that may result from reliance on such information. The information contained herein is not intended as investment or legal advice, and readers are encouraged to seek the advice of a competent professional where such advice is required.
#FinanceMagnates #VisaDirect #GlobalPayments #FutureOfPayments #PaymentsInnovation #CrossBorderPayments #SecurePayments #SeamlessTransactions #FinancialInsights #PaymentsTrends #WebinarRecap #BusinessFinance #DigitalPayments #FintechInsights #Payments2025
Executive Interview with Elina Pedersen | Your Bourse | FMLS:24
Executive Interview with Elina Pedersen | Your Bourse | FMLS:24
Executive Interview with Elina Pedersen, Chief Revenue Officer at Your Bourse at the Finance Magnates London Summit 2024
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Executive Interview with Elina Pedersen, Chief Revenue Officer at Your Bourse at the Finance Magnates London Summit 2024
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Executive Interview with Rauan Khassan | TradingView | FMLS:24
Executive Interview with Rauan Khassan | TradingView | FMLS:24
Executive Interview with Rauan Khassan from TradingView at the Finance Magnates London Summit 2024
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Executive Interview with Rauan Khassan from TradingView at the Finance Magnates London Summit 2024
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