Coinbase Global (NASDAQ:COIN) stock dropped on Tuesday after it announced plans to offer $2 billion in convertible senior notes—$1 billion due in 2029 and $1 billion in 2032—through a private placement to qualified institutional buyers under Rule 144A.
If initial purchasers exercise their options, the company may offer up to an additional $300 million across both series.
Coinbase structured the notes as senior unsecured obligations, convertible into cash, stock, or a combination at its discretion.
Also Read: Why Coinbase’s Huge Rally Might Be Done
The company plans to use part of the proceeds to fund capped call transactions, which aim to minimize dilution and offset potential cash payments related to note conversions.
Coinbase intends to use the remaining funds for general corporate purposes, including working capital and expenditures, potential acquisitions, and repurchasing or repaying existing debt or common stock. The offering’s pricing, including interest rate and conversion terms, will be finalized based on market conditions.
Coinbase stock gained 24% year-to-date, surpassing the NASDAQ Composite Index’s over 9% increase, buoyed by the Trump administration’s crypto-friendly policies.
The company reported second-quarter revenue of $1.5 billion and adjusted EPS of $0.12, both of which fell short of analyst expectations. Revenue fell 26% quarter-over-quarter, with transaction revenue down 39% to $764 million. Despite weak spot trading volumes, the company highlighted record derivatives volume and growing USDC and Base Chain adoption.
Looking ahead, Coinbase expects July transaction revenue to be $360 million, with third-quarter subscription and services revenue between $665 million and $745 million. The company also warns of higher expenses tied to international expansion.
Last week, Cathie Wood‘s Ark Invest increased its stake in Coinbase by buying 95,678 shares across three ETFs—ARKF, ARKK, and ARKW—as Bitcoin neared all-time highs and crypto market momentum strengthened. Based on the closing price, the purchase was valued at approximately $30.11 million.
Bernstein analysts expect Coinbase to benefit as the SEC approaches a blockchain-native regulatory framework. They believe the agency’s plan to allow tokenized stocks and bonds, clarify digital asset classifications, and support on-chain financial infrastructure will position platforms like Coinbase to bridge traditional and crypto capital markets, eliminating the need for offshore structures and enabling broader, integrated services.
COIN Price Action: Coinbase stock is trading lower by 2.15% to $311.53 at last check on Tuesday.
Photo: Shutterstock
