As per a statement released on June 15, oinbase">Coinbase, the cryptocurrency exchange, has reached an accord for the redemption of 0.50% Convertible Senior Notes, which will mature in 2026, worth $64.5 million, but due to the 29% markdown from the par value of the notes, the company approximates that a cash sum of $45.5 million will suffice to finalize the agreement.
Alesia Haas, who holds the position of Chief Financial Officer at oinbase">Coinbase, has referred to the transaction as an “opportunistic repurchase”. She further stated that the company will remain vigilant for similar opportunities in the future. It has been observed that several of oinbase">Coinbase’s debt instruments have been trading at reduced values since the beginning of the cryptocurrency bear market.
According to a disclosure made in May 2022, there is a possibility that users’ digital assets held on the platform may be subjected to bankruptcy proceedings and could be treated as unsecured creditors in the unfortunate event that the company goes bankrupt. This information has further amplified concerns among investors.
A notable example pertains to the oinbase">Coinbase Global Inc. DL-Notes 2021(21/31) that were released in September 2021, which are presently being traded at 54 cents on the dollar. It is worth noting that over $1 billion of this debt was issued with a coupon rate of 3.625% and a maturity date of October 2023. Given the current state of affairs, the bond is yielding 15.2%.
Despite the discounts offered, it seems that investors have not been swayed. This could be attributed to the fact that on June 6, the United States Securities and Exchange Commission filed charges against oinbase">Coinbase for allegedly running an unregistered securities exchange as well as selling unregistered securities through its staking-as-a-service program. It is important to note that this legal matter is still ongoing.
