In a surprising shift, Coinbase (NASDAQ:COIN) Global Inc, one of the world's leading crypto exchanges, has announced on Tuesday that it has raised its bond buyback limit to $180 million from the initial $150 million. This move comes after an unexpected surge in investor participation which followed the company's decision to extend the bond buyback program deadline.
Coinbase initially launched its bond buyback program with a cap of $150 million. The program, which allows the company to repurchase its 2031 bonds on the open market, was met with a lukewarm response. Investors tendered only $50 million worth of bonds, indicating that they were possibly holding onto their assets in anticipation of future appreciation.
However, Coinbase's decision to increase the buyback cap to $180 million and extend the expiration date of the Tender Offer from September 1, 2023, to September 18, 2023, resulted in a significant rise in investor involvement. In the days following these announcements, investors offered an additional $211 million in bonds for a total of $261 million.
The bond buyback program is a business strategy where corporations repurchase their own bonds on the open market. By implementing such a program, companies can reduce their debt load and potentially boost the value of their outstanding bonds. Coinbase first ventured into this financial transaction cycle when it became a publicly listed company in 2021.
This sudden turnaround in Coinbase's bond buyback program is considered a notable development within the crypto industry. It demonstrates that investors have reassessed their positions and decided to take advantage of Coinbase's revised offer.
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