Coinbase Global Inc. has announced plans to raise $1 billion through a private offering of convertible notes to institutional investors. The notes will mature in 2030 and the funds raised will be used to pay down debt and finance general corporate activities like operating expenses and business expansion.
Investors will have the option to purchase an additional $150 million in notes, providing flexibility. Uniquely, Coinbase may choose to repay the notes in cash, its common stock shares, or a combination upon maturity.
The announcement initially caused Coinbase’s stock price to dip, but it has since rebounded. Over the past month, shares are up 74% and have soared 379% year-to-date. This surge is partly attributed to the recent approval of spot Bitcoin ETFs, which expanded Coinbase’s revenue streams and boosted confidence in the crypto market.
However, some analysts who were previously bullish are now bearish on Coinbase stock due to its volatility. While investors expect continued demand for Bitcoin ETFs, analysts warn this trend could reverse if interest in these funds wanes. As the crypto market evolves, Coinbase’s ability to raise funds underscores investors’ ongoing interest despite the risks
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