Coinbase raised its bond buyback limit to $180 million amid a surge in investor interest

Effective Sept. 5, Coinbase increased its bond redemption limit to $180 million and extended the deadline to the 18th as well, according to a June 5 statement.

Coinbase has decided to extend the buyback program due to the very high interest in it. The exchange first offered to buy back its 3.625% senior bonds maturing in 2031 at $675 per $1,000 for the principal amount of the bonds offered for sale.

At an early stage of the tender, bondholders offered about $50 million worth of bonds, reflecting an initial offering price of 64.5 cents per dollar and an initial issue value of more than $5,000. the price increased to 67.5 cents per dollar and the interim expiration period was extended. As a result, the total cost of the buyout amounted to 261 million US dollars.

With the increased maximum purchase amount, Coinbase can purchase all of the bonds offered, and possibly more. This surge in interest from bondholders means that many market participants may view the current purchase price as fair and see limited upside potential in holding to maturity.

Bonds to be issued in 2021.

In 2021, during the cryptocurrency bull market, Coinbase issued these $1 billion bonds. After that, some crypto projects such as FTX, BlockFi and Celsius faced insolvency. Regulators have stepped up regulatory pressure on the growing industry thanks to their financial pressure. The US Securities and Exchange Commission filed lawsuits against Coinbase, alleging that it violated securities laws.

Despite this, the bond price has risen from a low of 47 cents per dollar by the end of December 2022 to the current purchase price. Despite negative macroeconomic data (rising prices at the end of the previous year) and the negative impact of the dominant sentiment among exchange players, Coinbase shares have risen by almost 118% since the beginning of this.