Coinbase Announces Plans to Buy Back Part of $1B Bonds

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Coinbase, buoyed by a strong second-quarter financial performance, is looking to repurchase a portion of its $1 billion bonds from investors at a premium.

The cryptocurrency exchange plans to buy back a maximum of $150 million worth of its $1 billion bonds set to mature in 2031, as announced on Monday.

Investors who decide to participate in the buyback and sell their bonds prior to August 18th will receive $645 for each $1,000 face value of the bond, including an early-tender premium of $30 (equivalent to 64.5 cents on the dollar).

For those who sell their bonds between August 18 and September 1, the offer expiration date, Coinbase will provide $615 for every $1,000 face value of the bond (equivalent to 61.5 cents on the dollar).

This buyback offer carries a premium, as both offer prices exceed the bond’s unaffected price before the announcement on August 4th, which stood at around 60 cents on the dollar, according to Business Insider data.

This slight premium is a result of Coinbase surpassing analyst predictions for the second quarter, with reported revenues of $708 million and an adjusted loss of $0.42 per share, outperforming projected revenues of $628 million and a loss of $0.76 per share. The ongoing strength of the Bitcoin price in 2023 may also contribute to this buyback initiative.

Citigroup Global Markets has been enlisted by Coinbase to oversee the buyback process. Notably, the 2031 bonds subject to the buyback represent only one of three outstanding debts for Coinbase.