Coinbase, the largest cryptocurrency exchange in the United States, revealed Monday that it plans to raise $1.5 billion through debt financing.
The Nasdaq-listed crypto exchange intends to utilize the funds obtained to expand the company's balance sheet for general business reasons, as well as future investments and acquisitions of other companies, goods, or technology, according to Coinbase.
The completion of the offering is subject to market and other circumstances, according to the business.
The new offering seeks to provide a $1.5 billion aggregate principal amount of the firm's senior notes due 2028 and 2031, which will be fully guaranteed by Coinbase Inc., a wholly-owned Coinbase subsidiary serving as its holding company.
Negotiations between the business and initial purchasers will determine the interest rate, redemption conditions, and other parameters of the increase.
Coinbase said that the notes and accompanying guarantee will be offered and sold exclusively through a private offering memorandum to individuals “reasonably considered to be qualified institutional buyers” under local securities regulations and outside the United States.
“Neither the notes nor the related guarantee has been, nor will they be, registered under the Securities Act or the securities laws of any other jurisdiction, and unless so registered, they may not be offered or sold in the United States, except under an applicable exemption from such registration requirements,” Coinbase added.
The announcement comes as Coinbase faces heightened scrutiny from securities authorities, with the US Securities and Exchange Commission threatening to prosecute the exchange last week over its planned crypto lending scheme.
Coinbase CEO Brian Armstrong pointed out that there are now several other crypto businesses on the market that offer comparable loan services to their clients.
Coinbase is one of the world's major cryptocurrency exchanges, with daily trading volumes exceeding $5.6 billion.
Previously, the firm expected to raise $1.25 billion in private debt security offering in May 2021, shortly after coming public with a direct listing on Nasdaq in mid-April.