Coinbase sees tepid interest in bond buyback offer that could signal upside

Quick Take

  • Coinbase’s offer to buy back bonds with a face value of $150 million has so far generated limited interest.
  • Bondholders have agreed to tender about $50 million of the bonds, while investors have until Sept. 1 to make their final decision.

Coinbase's offer to buy back bonds with a face value of $150 million has so far been met with limited interest in a development that suggests many investors think there's more upside for the notes.

The crypto exchange said Monday that it had increased its repurchase offer to 67.5 cents on the dollar and that bonds worth $50 million at face value had so far been tendered. 

The notes, which have a coupon of 3.625% and mature in 2031, are currently trading around 63.5 cents on the dollar. Bondholders still have until Sept. 1 to make their final decision and take the deal.

Coinbase first announced the offer to partially buy back the $1 billion issue earlier this month. The bonds had dipped below 60 cents on the dollar shortly before the company first announced the deal. 

Coinbase regulatory concerns

Although Coinbase continues to wrestle with regulatory concerns, its most recent earnings report beat analysts' estimates. The company's shares have fallen almost 29% over the past month, but they're still up more than 100% so far this year. 

In June, ratings agency Moody's cut its outlook on the company to negative from stable in the wake of a lawsuit filed against it by the Securities and Exchange Commission. 

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