Coinbase Follows MicroStrategy with $1 Billion Convertible Bond Offering

Coinbase plans to raise $1 billion through a private placement of convertible debt. The cryptocurrency exchange intends to use the proceeds for debt repayment, general corporate purposes, and potential acquisitions.

Investors will have an option to purchase an additional $150 million in securities.

The offering includes a provision for “capped call transactions,” which aims to minimize shareholder dilution upon bond conversion. This conversion could occur in 2030. If the issuer exercises the option, holders may receive either shares or cash.

The placement will occur “subject to market conditions and other factors.” Terms will be set at issuance, and the securities will be available to qualified investors.

The initiative follows MicroStrategy’s $800 million convertible bond offering, including an option. The corporation used the funds to purchase 12,000 BTC.

Founded by Michael Saylor, the firm has acquired a total of 205,000 BTC, partly through $2 billion in public market debt, according to CoinDesk.

The placement is planned following bitcoin reaching new all-time highs. Since the beginning of the year, digital gold has risen by 72.3%, and Coinbase shares by 47.3%.

Media outlets noted the withdrawal of bearish recommendations on the exchange’s securities by analysts from Raymond James and Goldman Sachs amid improving conditions in the digital asset market.

Earlier, Saylor declared a “gold rush” for the leading cryptocurrency, expected to last until November 2034. Previously, Coinbase highlighted risks to bitcoin’s further growth.