First Mover Americas: Coinbase Plans $1B Bond Sale

BY Coindesk | CORPORATE | 03/13/24 08:01 AM EDT By Lyllah Ledesma

This article originally appeared in First Mover, CoinDesk's daily newsletter, putting the latest moves in crypto markets in context. Subscribe to get it in your inbox every day.

Latest Prices

Top Stories

Coinbase (COIN) announced a plan to cash in on the recent rally in digital assets by raising $1 billion through selling convertible bonds, avoiding an equity sale that could hurt its stock price. The plan also follows the path Michael Saylor's MicroStrategy (MSTR) has taken to fund its crypto aspirations. The crypto exchange said on Tuesday that it will offer the unsecured convertible senior notes through a private offering. Convertible bonds can be turned into shares of the issuing company (or cash) at a certain point, in this case, the conversion year is 2030. Had the company chosen to raise money by selling new shares, that would have diluted the ownership interest of existing shareholders ? something they might have viewed unfavorably.

Ether (ETH) prices might see a correction, Singapore-based digital assets trading firm QCP Capital said in a morning note. The trading firm said it is still cautiously optimistic about the long-term potential of ether. Although ether has sailed past $4,000, its highest price in two years, QCP writes that it's observing a shift in market sentiment, marked by negative risk reversals. These reversals measure the difference in implied volatility between call and put options and have turned negative, likely due to the low probability of a spot ether ETF being approved in the near future. QCP also wrote that it is concerned about the amount of leverage currently in the market, but traders will quickly buy back any dips. Excessive leverage is said to have caused the May 2021 crash, where prices fell by 30% over the course of 24 hours, and a 10% correction in bitcoin's price in January.

Current U.S. intellectual property laws are adequate to deal with concerns about copyright and trademark infringement associated with non-fungible tokens (NFTs), a 112-page study by the United States Patent and Trademark Office (USPTO) and the U.S. Copyright Office concluded. The study was requested by the former Democrat senator from Vermont, Patrick Joseph Leahy, and the Democrat senator from North Carolina, Thom Tillis, in June 2022. The USPTO and the Copyright Office conducted three public roundtables and solicited comments from interested stakeholders. The offices found that most stakeholders say the current laws are adequate, even though "trademark misappropriation and infringement are common on NFT platforms."

Trending Posts

  • Terraform Labs Allowed to Hire Law Firm Dentons in Bankruptcy Case by U.S. Court: Reuters
  • Binance-Nigeria Brawl Continues as Country Asks Exchange to Submit List of Top 100 Users
  • SEC Orders First Trust-SkyBridge to Declare Its Bitcoin ETF Application Abandoned

In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.