The largest cryptocurrency exchange will raise $1.5 billion in a private offering to strengthen its financial sheet.
Coinbase ($COIN), one of the largest cryptocurrency exchanges with over 50 million registered users, has launched its first private debt offering of $1.5 billion in the form of Senior Note Offerings. The proceeds from the offers will be used for general corporate purposes and product development.
The private senior note offering contracts are due in 2028 and 2031, and Coinbase Inc. will fully and unconditionally support them. Negotiations with early buyers would decide the interest rate, redemption provisions, and other contract parameters.
“This capital raise represents an opportunity to bolster our already strong balance sheet with low-cost capital. Coinbase intends to use the net proceeds from the offering for general corporate purposes, which may include continued investments in product development, as well as potential investments in or acquisitions of other companies, products, or technologies that Coinbase may identify in the future. The closing of the offering is subject to market and other conditions.”
The cryptocurrency exchange that went public on Nasdaq in April of this year with one of the highest valuations at the time of its initial public offering. The company is currently increasing its product and service offerings as well as entering new markets. Japanese regulators permitted the crypto exchange to provide its services in Japan, and the crypto exchange afterward became the first company to receive Bafin clearance for crypto custody services in Germany.
Coinbase Prepares for an SEC Challenge
Coinbase’s news on private debt offerings comes just days after the company revealed that the SEC has threatened to prosecute it over its unpublished USDC stablecoin lending services, which the regulatory body believed to be a security. The Exchange’s CEO, Brian Armstrong, criticized the SEC for its lack of clarification and threats but insisted that the company would continue to endeavor to provide the finest crypto services to users.
The SEC controversy is seen as an obstacle in Coinbase’s meteoric rise over the years, and it may reopen the security debate, which is already raging with the Ripple case.
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