Coinbase announced a $1.5-billion bond sale shortly after the SEC threatened to sue the firm over its lending program.
Coinbase, the largest cryptocurrency exchange in the United States, is planning to raise $1.5 billion via a debt offering, the company officially announced Monday.
The Nasdaq-listed crypto exchange is looking to use the capital raised to further grow the company’s balance sheet for general corporate purposes as well as potential investments and acquisitions of other companies, products or technology, Coinbase said. The closing of the offering is subject to market and other conditions, the firm noted.
The new raise specifically aims to offer a $1.5-billion aggregate principal amount of the company’s senior notes due 2028 and 2031, which will be fully guaranteed by Coinbase Inc., a wholly-owned Coinbase subsidiary acting as its holding company. The interest rate, redemption provisions and other terms of the raise are subject to negotiations between the firm and initial purchasers.
Coinbase noted that the notes and the related guarantee would be only offered and sold by means of a private offering memorandum to persons “reasonably believed to be qualified institutional buyers” under local securities laws as well as outside the United States.
“Neither the notes nor the related guarantee have been, or will be, registered under the Securities Act or the securities laws of any other jurisdiction, and unless so registered, may not be offered or sold in the United States, except pursuant to an applicable exemption from such registration requirements,” Coinbase added.
The news comes amid Coinbase facing increased attention from securities regulators, with the U.S. Securities and Exchange Commission threatening to sue the exchange over its upcoming crypto lending program last week. Coinbase CEO Brian Armstrong pointed out that there are a number of other crypto firms on the market that currently provide similar lending services to their customers.
Facilitating over $5.6 billion in daily trading volumes, Coinbase is one of the world’s largest cryptocurrency exchanges. The company previously planned to raise $1.25 billion through a private debt securities offering in May 2021, shortly after going public with a direct listing on Nasdaq in mid-April.
Article is taken from Cointelegraph